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
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: 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
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