Location of Repository

Payoff dominance and the Stackelberg heuristic.

By Andrew M. Colman and M. Bacharach


This is the author's final draft. \ud 'The original publication is available at www.springerlink.com.'\ud http://www.springerlink.com/content/h46232710q241451/fulltext.pdfPayoff dominance, a criterion for choosing between equilibrium points in games, is intuitively compelling, especially in matching games and other games of common interests, but it has not been justified from standard game-theoretic rationality assumptions. A psychological explanation of it is offered in terms of a form of reasoning that we call the Stackelberg heuristic in which players assume that their strategic thinking will be anticipated by their co-player(s). Two-person games are called Stackelberg-soluble if the players' strategies that maximize against their co-players' best replies intersect in a Nash equilibrium. Proofs are given that every game of common interests is Stackelberg-soluble, that a Stackelberg solution is always a payoff-dominant outcome, and that in every game with multiple Nash equilibria a Stackelberg solution is a payoff-dominant equilibrium point. It is argued that the Stackelberg heuristic may be justified by evidentialist reasoning

Publisher: Springer
Year: 1997
OAI identifier: oai:lra.le.ac.uk:2381/471

Suggested articles



  1. (1944). 3rd ed., doi
  2. (1988). A General Theory of Equilibrium Selection in Games, doi
  3. (1995). A Theory of Focal Points', doi
  4. (1987). A Theory of Rational Decision in Games', doi
  5. (1994). An Experimental Study of the Variable Frame Theory of Focal Points', working paper, doi
  6. (1995). Attribution and Social Cognition',
  7. (1989). Causal Attribution: From Cognitive Processes to Collective Beliefs, doi
  8. (1984). Causal Versus Diagnostic Contingencies: On Selfdeception and the Voter's Illusion', doi
  9. (1985). Causality, Decision, and Newcomb's Paradox, in doi
  10. (1990). Communication, Computability and Common Interest Games', working paper, St John's College,
  11. (1988). Communication, Coordination and Nash Equilibrium', doi
  12. (1969). Convention: A Philosophical Study, doi
  13. (1995). Cooperating Without Communicating', working paper,
  14. (1989). Cooperation and Bounded Recall', doi
  15. (1978). Counterfactuals and Two Kinds of Expected Utility', doi
  16. (1994). Experimental Evidence on Players' Models of Other Players', doi
  17. (1994). Focal Points in Pure Coordination Games: An Experimental Investigation', Theory and Decision, doi
  18. (1995). Game Theory and its Applications in the Social and Biological Sciences, doi
  19. (1974). General” Metagames: An Extension of the Metagame Concept', In doi
  20. (1990). Learning How to Cooperate: Optimal Play in Repeated Coordination Games', doi
  21. (1991). Newcomb's problem, Prisoner's Dilemma, and Collective Action', doi
  22. (1971). Paradoxes of Rationality: Theory of Metagames and Political Behavior, doi
  23. (1979). Prisoner's Dilemma is a Newcomb Problem', doi
  24. (1991). Rational Choice: A Survey of Contributions from Economics and Philosophy', doi
  25. (1994). Stereotyping and Social Reality,
  26. (1987). The Present and Future of Metagame Analysis', doi
  27. (1982). The Simulation Heuristic', doi
  28. (1960). The Strategy of Conflict, doi
  29. (1956). Theory of the Reluctant Duellist'
  30. (1993). Thinking as a Team: Towards an Explanation of Nonselfish Behavior', doi
  31. (1985). Unanimity Games and Pareto Optimality', doi
  32. (1993). Variable Universe Games', in
  33. von: 1934, Marktform und Gleichgewicht, doi

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.