Subgame–Perfect Equilibria of Finite– and Infinite–Horizon Games

Drew Fudenberg and David Levine

Chapter 1 in A Long-Run Collaboration on Long-Run Games, 2008, pp 3-20 from World Scientific Publishing Co. Pte. Ltd.

Abstract: AbstractWe show that subgame-perfect equilibria of infinite-horizon games arise as limits, as the horizon grows long and epsilon small, of subgame-perfect epsilon-equilibria of games which are truncated after a finite horizon. A number of applications show that this result provides a useful technique for analyzing the existence and uniqueness of infinite-horizon equilibria. We extend our result to the sequential equilibrium concept.

Keywords: Long-Run Players; Limit Games; Robustness; Equilibrium; Reputation Effects; Repeated Games (search for similar items in EconPapers)
JEL-codes: I10 (search for similar items in EconPapers)
Date: 2008
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Related works:
Journal Article: Subgame-perfect equilibria of finite- and infinite-horizon games (1983)
Working Paper: Subgame-Perfect Equilibria of Finite- and Infinite-Horizon Games (1983)
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