234 research outputs found

    A semantical approach to equilibria and rationality

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    Game theoretic equilibria are mathematical expressions of rationality. Rational agents are used to model not only humans and their software representatives, but also organisms, populations, species and genes, interacting with each other and with the environment. Rational behaviors are achieved not only through conscious reasoning, but also through spontaneous stabilization at equilibrium points. Formal theories of rationality are usually guided by informal intuitions, which are acquired by observing some concrete economic, biological, or network processes. Treating such processes as instances of computation, we reconstruct and refine some basic notions of equilibrium and rationality from the some basic structures of computation. It is, of course, well known that equilibria arise as fixed points; the point is that semantics of computation of fixed points seems to be providing novel methods, algebraic and coalgebraic, for reasoning about them.Comment: 18 pages; Proceedings of CALCO 200

    Perfect Prediction in Minkowski Spacetime: Perfectly Transparent Equilibrium for Dynamic Games with Imperfect Information

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    The assumptions of necessary rationality and necessary knowledge of strategies, also known as perfect prediction, lead to at most one surviving outcome, immune to the knowledge that the players have of them. Solutions concepts implementing this approach have been defined on both dynamic games with perfect information and no ties, the Perfect Prediction Equilibrium, and strategic games with no ties, the Perfectly Transparent Equilibrium. In this paper, we generalize the Perfectly Transparent Equilibrium to games in extensive form with imperfect information and no ties. Both the Perfect Prediction Equilibrium and the Perfectly Transparent Equilibrium for strategic games become special cases of this generalized equilibrium concept. The generalized equilibrium, if there are no ties in the payoffs, is at most unique, and is Pareto-optimal. We also contribute a special-relativistic interpretation of a subclass of the games in extensive form with imperfect information as a directed acyclic graph of decisions made by any number of agents, each decision being located at a specific position in Minkowski spacetime, and the information sets and game structure being derived from the causal structure. Strategic games correspond to a setup with only spacelike-separated decisions, and dynamic games to one with only timelike-separated decisions. The generalized Perfectly Transparent Equilibrium thus characterizes the outcome and payoffs reached in a general setup where decisions can be located in any generic positions in Minkowski spacetime, under necessary rationality and necessary knowledge of strategies. We also argue that this provides a directly usable mathematical framework for the design of extension theories of quantum physics with a weakened free choice assumption.Comment: 25 pages, updated technical repor

    TR-2013007: On Definitive Solutions of Strategic Games

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    Social Recognition and Economic Equilibrium

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    This paper is an attempt to incorporate the human ability of recognition, especially, the ability to recognize the society to which they belong, with the economic equilibrium theory characterized by a description of society through individual rational behaviors. Contents may be classified into the following three categories: (1) a rigorous set theoretical treatment of the description of individual rationality; (2) set theoretical description of the validity in a society; and (3) rationality as an equilibrium (fixed point) of social recognition.Social Recognition, Rationality, Social Equilibrium, Fixed Point Theorem, Goedel's Incompleteness Theorem.

    Common Knowledge and Interactive Behaviors: A Survey

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    This paper surveys the notion of common knowledge taken from game theory and computer science. It studies and illustrates more generally the effects of interactive knowledge in economic and social problems. First of all, common knowledge is shown to be a central concept and often a necessary condition for coordination, equilibrium achievement, agreement, and consensus. We present how common knowledge can be practically generated, for example, by particular advertisements or leadership. Secondly, we prove that common knowledge can be harmful, essentially in various cooperation and negotiation problems, and more generally when there are con icts of interest. Finally, in some asymmetric relationships, common knowledge is shown to be preferable for some players, but not for all. The ambiguous welfare effects of higher-order knowledge on interactive behaviors leads us to analyze the role of decentralized communication in order to deal with dynamic or endogenous information structures.Interactive knowledge, common knowledge, information structure, communication.

    A natural approach to optimal forecasting in case of preliminary observations

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    Forecasting Techniques;mathematische statistiek
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