Robust Equilibria In Generic Extensive-Form Games

Lucas Pahl () and Carlos Pimienta ()
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Lucas Pahl: School of Economics, University of Sheffield, Sheffield S1 4DT, UK
Carlos Pimienta: School Of Economics, The University of New South Wales, Sydney, Australia

No 2025001, Working Papers from The University of Sheffield, Department of Economics

Abstract: We prove the 2-player, generic extensive-form case of the conjecture of Govindan and Wilson (1997a,b) and Hauk and Hurkens (2002) stating that an equilibrium component is essential in every equivalent game if and only if the index of the component is nonzero. This provides an index-theoretic characterization of the concept of hyperstable components of equilibria in generic extensive-form games, first formulated by Kohlberg and Mertens (1986). We also illustrate how to compute hyperstable equilibria in multiple economically relevant examples and show how the predictions of hyperstability compare with other solution concepts.

Keywords: Game Theory; Robustness of Equilibria; Fixed Point Theory; Index Theory (search for similar items in EconPapers)
JEL-codes: C72 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2025-01
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