Nash Dominance with Applications to Equilibrium Problems with Equilibrium Constraints

Abstract

We examine a novel idea for the detection of Nash Equilibrium developed in Lung and Dumitrescu 2008 and apply it to Equilibrium Problems with Equilibrium Constraints (EPECs). EPECs are Nash games which uniquely feature players constrained by a condition governing equilibrium of a parametric system. By redefining the selection criteria used in evolutionary methods, EPECs can be solved using Evolutionary Multiobjective Optimization algorithms. We give a proposed algorithm (NDEMO) and illustrate it with numerical examples