The Computation of Perfect and Proper Equilibrium for Finite Games via Simulated Annealing

Stuart McDonald () and Liam Wagner

No 151191, Risk and Sustainable Management Group Working Papers from University of Queensland, School of Economics

Abstract: This paper exploits an analogy between the “trembles” that underlie the functioning of simulated annealing and the player “trembles” that underlie the Nash refinements known as perfect and proper equilibrium. This paper shows that this relationship can be used to provide a method for computing perfect and proper equilibria of n-player strategic games. This paper also shows, by example, that simulated annealing can be used to locate a perfect equilibrium in an extensive form game.

Keywords: Institutional; and; Behavioral; Economics (search for similar items in EconPapers)
Pages: 19
Date: 2010-04-21
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Citations: View citations in EconPapers (2)

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Working Paper: The Computation of Perfect and Proper Equilibrium for Finite Games via Simulated Annealing (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uqsers:151191

DOI: 10.22004/ag.econ.151191

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