TY - BOOK
T1 - Stochastic games with endogenous transitions
AU - Joosten, Reinoud A.M.G.
AU - Meijboom, Robin
PY - 2010/11
Y1 - 2010/11
N2 - We introduce a stochastic game in which transition probabilities depend on the history of the play, i.e., the players' past action choices. To solve this new type of game under the limiting average reward criterion, we determine the set of jointly-convergent pure-strategy rewards which can be supported by equilibria involving threats. We examine the following setting for motivational and expository purposes. Each period, two agents exploiting a fishery choose between catching with restraint or without. The fish stock is in either of two
states, High or Low, and in the latter each action pair yields lower payoffs. Restraint is harmless to the fish, but it is a dominated strategy in each stage game. Absence of restraint damages the resource, i.e., the less restraint the agents show, the higher the probablities that Low occurs at the next stage of the play. This state may even become 'absorbing', i.e., transitions to High become impossible.
AB - We introduce a stochastic game in which transition probabilities depend on the history of the play, i.e., the players' past action choices. To solve this new type of game under the limiting average reward criterion, we determine the set of jointly-convergent pure-strategy rewards which can be supported by equilibria involving threats. We examine the following setting for motivational and expository purposes. Each period, two agents exploiting a fishery choose between catching with restraint or without. The fish stock is in either of two
states, High or Low, and in the latter each action pair yields lower payoffs. Restraint is harmless to the fish, but it is a dominated strategy in each stage game. Absence of restraint damages the resource, i.e., the less restraint the agents show, the higher the probablities that Low occurs at the next stage of the play. This state may even become 'absorbing', i.e., transitions to High become impossible.
KW - IR-76562
KW - common pool resource dilemma
KW - Equilibria
KW - Stochastic games
KW - endogenous transitions
KW - limiting average rewards
M3 - Report
T3 - Papers on economics & evolution, ISSN 1430-4716
BT - Stochastic games with endogenous transitions
PB - Max Planck Gesellschaft
CY - Jena, Germany
ER -