Abstract
We study the properties of finitely complex, symmetric, globally stable, and semi-perfect equilibria. We show that: (1) If a strategy satisfies these properties then players play a Nash equilibrium of the stage game in every period; (2) The set of finitely complex, symmetric, globally stable, semi-perfect equilibrium payoffs in the repeated game equals the set of Nash equilibria payoffs in the stage game; and (3) A strategy vector satisfies these properties in a Pareto optimal way if and only if players play some Pareto optimal Nash equilibrium of the stage game in every stage. Our second main result is a strong anti-Folk Theorem, since, in contrast to what is described by the Folk Theorem, the set of equilibrium payoffs does not expand when the game is repeated.
Original language | English |
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Pages (from-to) | 131-151 |
Number of pages | 21 |
Journal | International Journal of Game Theory |
Volume | 34 |
Issue number | 1 |
DOIs | |
Publication status | Published - 1 Apr 2006 |
Keywords
- Complexity
- Nash equilibrium
- Social institutions
- Stability