Abstract
We introduce best response dynamics for settings where agents' preferences are diverse. Under these dynamics, which are defined on the space of Bayesian strategies, rest points and Bayesian equilibria are identical. We prove the existence and uniqueness of solution trajectories to these dynamics, and provide methods of analyzing the dynamics based on aggregation.
Original language | English (US) |
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Pages (from-to) | 83-109 |
Number of pages | 27 |
Journal | Games and Economic Behavior |
Volume | 53 |
Issue number | 1 |
DOIs | |
State | Published - Oct 2005 |
Funding
We thank Drew Fudenberg, Josef Hofbauer, Larry Samuelson, and Jörgen Weibull, two anonymous referees and an anonymous Associate Editor, and seminar audiences at the Stockholm School of Economics and at Wisconsin for their comments. Results in this paper were previously circulated under the title “Evolution with Diverse Preferences.” Financial support from NSF Grants SBR-9810787 and SES-0092145 is gratefully acknowledged.
ASJC Scopus subject areas
- Finance
- Economics and Econometrics