Categorization in Games: A Bias-Variance Perspective

Philippe Jehiel () and Erik Mohlin ()
Additional contact information
Erik Mohlin: Skane University Hospital [Lund], Institute for Futures Studies

Working Papers from HAL

Abstract: We develop a framework for categorization in games, applicable both to multistage games of complete information and static games of incomplete information. Players use categories to form coarse beliefs about their opponents' behavior. Players best-respond given these beliefs, as in analogy-based expectations equilibria. Categories are related to previously used strategies via the requirements that categories contain a sufficient amount of observations and exhibit sufficient withincategory similarity, in line with the bias-variance trade-off. When applied to classic games including the chainstore game and adverse selection games our framework yields less unintuitive predictions than those arising with standard solution concepts.

Keywords: Bounded rationality; Categorization; Bias-variance trade-off; Adverse selection; Chainstore paradox (search for similar items in EconPapers)
Date: 2023-07
New Economics Papers: this item is included in nep-gth and nep-mic
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-04154272v1
References: Add references at CitEc
Citations:

Downloads: (external link)
https://shs.hal.science/halshs-04154272v1/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:wpaper:halshs-04154272

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().