Sufficient conditions for the existence of a Nash equilibrium are given when preferences may violate the reduction of compound lotteries assumption (RCLA). Without RCLA decision makers may not be indifferent between compound lotteries which have the same probabilities of final outcomes. Therefore the conditions depend on how players perceive the game-whether they view themselves as moving first or second. We also review conditions under which the equilibria will be dynamically consistent.
ASJC Scopus subject areas
- Economics and Econometrics