by David P Myatt and Chris Wallace.
Download the Paper in PDF Format.
Journal of Economic Theory, 113 (2), pp. 286-301, December 2003.
Abstract: A strategy revision process in symmetric normal form games is proposed. Following Kandori et al. (Econometrica 61 (1993) 29), members of a population periodically revise their strategy choice, and choose a myopic best response to currently observed play. Their payoffs are perturbed by normally distributed Harsanyian trembles, so that strategies are chosen according to multinomial probit probabilities. As the variance of payoffs is allowed to vanish, the graph theoretic methods of the earlier literature continue to apply. The distributional assumption enables a convenient closed form characterisation for the weights of the rooted trees. An illustration of the approach is offered, via a consideration of the role of dominated strategies in equilibrium selection.
Note: There is an error in the published version of this paper. Chris Wallace and I will upload the correction here when it’s written up. Meanwhile, recent work by Sandholm and Dokumaci encompasses the results contained in this piece. Thank you to them for pointing out a mathematical embarrassment in the paper.
