Economics at your fingertips  

A Model Of Tacit Collusion: Nash-2 Equilibrium Concept

Marina Sandomirskaia ()

No WP BRP 70/EC/2014, HSE Working papers from National Research University Higher School of Economics

Abstract: We examine the novel concept for repeated noncooperative games with bounded rationality: \Nash-2" equilibrium, called also \threatening-proof pro le" in [16, Iskakov M., Iskakov A., 2012b]. It is weaker than Nash equilibrium and equilibrium in secure strategies: a player takes into account not only current strategies but also the next-stage responses of the partners to her deviation from the current situation that reduces her relevant choice set. We provide a condition for Nash-2 existence, criteria for a strategy pro le to be the Nash-2 equilibrium in strictly competitive games, apply this concept to Bertrand and Hotelling game and interpret the results as tacit collusion

Keywords: Nash-2 equilibrium; secure deviation; Bertrand paradox; Hotelling model; tacit collusion. (search for similar items in EconPapers)
JEL-codes: C72 D03 D43 D70 L13 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com and nep-hpe
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed

Published in WP BRP Series: Economics / EC, November 2014, pages 1-20

Downloads: (external link) (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:

Access Statistics for this paper

More papers in HSE Working papers from National Research University Higher School of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Shamil Abdulaev ().

Page updated 2019-10-17
Handle: RePEc:hig:wpaper:70/ec/2014