# Valuation Equilibria

*Philippe Jehiel* () and
*Dov Samet* ()

Game Theory and Information from EconWPA

**Abstract:**
We introduce a new solution concept for games in extensive form with perfect information: the valuation equilibrium. The moves of each player are partitioned into similarity classes. A valuation of the player is a real valued function on the set of her similarity classes. At each node a player chooses a move that belongs to a class with maximum valuation. The valuation of each player is \emph{consistent} with the strategy profile in the sense that the valuation of a similarity class is the player expected payoff given that the path (induced by the strategy profile) intersects the similarity class. The solution concept is applied to decision problems and multi-player extensive form games. It is contrasted with existing solution concepts. An aspiration-based approach is also proposed, in which the similarity partitions are determined endogenously. The corresponding equilibrium is called the aspiration-based valuation equilibrium (ASVE). While the Subgame Perfect Nash Equilibrium is always an ASVE, there are other ASVE in general. But, in zero-sum two-player games without chance moves every player must get her value in any ASVE.

**Keywords:** bounded rationality; valuation; similarity; aspiration. (search for similar items in EconPapers)

**JEL-codes:** C72 D81 (search for similar items in EconPapers)

**New Economics Papers:** this item is included in nep-gth

**Date:** 2003-10-08

**Note:** Type of Document - ; pages: 18

**References:** View references in EconPapers View complete reference list from CitEc

**Citations** View citations in EconPapers (2) Track citations by RSS feed

**Downloads:** (external link)

http://econwpa.repec.org/eps/game/papers/0310/0310003.pdf (application/pdf)

**Related works:**

Journal Article: Valuation equilibrium (2007)

Working Paper: Valuation Equilibrium (2007)

Working Paper: Valuation Equilibria (2006)

Working Paper: Valuation Equilibria (2003)

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:wpa:wuwpga:0310003

Access Statistics for this paper

More papers in Game Theory and Information from EconWPA

Bibliographic data for series maintained by EconWPA ().