A Re-Interpretation of Nash Equilibrium Based on the Notion of Social Institutions

Guilherme Carmona

Game Theory and Information from University Library of Munich, Germany

Abstract: We define social institutions as strategies in some repeated game. With this interpretation in mind, we consider the impact of introducing requirements on strategies which have been viewed as necessary properties for any social institution to endure. The properties we study are finite complexity, symmetry, global stability, and semi-perfection. We show that: (1) If a strategy satisfies these properties then players play a Nash equilibrium of the stage game in every period; (2) The set of finitely complex, symmetric, globally stable, semi-perfect equilibrium payoffs in the repeated game equals the set of Nash equilibria payoffs in the stage game; and (3) A strategy vector satisfies these properties in a Pareto optimal way if and only if players play some Pareto optimal Nash equilibrium of the stage game in every stage. These results provide a social institution interpretation of Nash equilibrium: individual behavior in enduring social institutions is described by Nash equilibria.

Keywords: Nash equilibrium; discounted repeated games; semi-perfect equilibrium; global stability; finite automata; social norms. (search for similar items in EconPapers)
JEL-codes: C73 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2003-11-19
Note: Type of Document - pdf; prepared on win xp; to print on general; pages: 23; figures: 0. none
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://econwpa.ub.uni-muenchen.de/econ-wp/game/papers/0311/0311005.pdf (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:wpa:wuwpga:0311005

Access Statistics for this paper

More papers in Game Theory and Information from University Library of Munich, Germany
Bibliographic data for series maintained by EconWPA ( this e-mail address is bad, please contact ).