A Necessary and Sufficient Condition for Convergence of Statistical to Strategic Equilibria of Market Games

International Game Theory Review (IGTR), 2009

Posted: 22 Jun 2010

See all articles by Dimitrios P. Tsomocos

Dimitrios P. Tsomocos

University of Oxford - Said Business School and St. Edmund Hall

Dimitris Voliotis

University of Piraeus

Date Written: December 1, 2009

Abstract

We analyze a market game where traders are heterogeneous with respect to their rationality level and have asymmetric information. The market mechanism results into a statistical equilibrium, where traders randomise among their available actions due to their limited rationality. We provide a necessary and sufficient condition for convergence of statistical to strategic equilibria of market games, when traders become more informed and increasingly more rational.

Keywords: Market games, bounded rationality, rational learning

Suggested Citation

Tsomocos, Dimitrios P. and Voliotis, Dimitris, A Necessary and Sufficient Condition for Convergence of Statistical to Strategic Equilibria of Market Games (December 1, 2009). International Game Theory Review (IGTR), 2009, Available at SSRN: https://ssrn.com/abstract=1627944

Dimitrios P. Tsomocos (Contact Author)

University of Oxford - Said Business School and St. Edmund Hall ( email )

Park End Street
Oxford, OX1 1HP
Great Britain
+44 1865 288 932 (Phone)
+44 1865 288 805 (Fax)

Dimitris Voliotis

University of Piraeus ( email )

Karaoli and Dimitriou 80
80 KARAOLI & DIMITRIOU STREET
Piraeus, Attiki 18534
Greece
00302104142227 (Phone)

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