A theory of regular Markov perfect equilibria in dynamic stochastic games: genericity, stability, and purification
This paper studies generic properties of Markov perfect equilibria in dynamic stochastic games. We show that almost all dynamic stochastic games have a finite number of locally isolated Markov perfect equilibria. These equilibria are essential and strongly stable. Moreover, they all admit purification. To establish these results, we introduce a notion of regularity for dynamic stochastic games and exploit a simple connection between normal form and dynamic stochastic games.
Year of publication: |
2010
|
---|---|
Authors: | Doraszelski, Ulrich ; Escobar, Juan |
Published in: |
Theoretical Economics. - New Haven, CT : The Econometric Society, ISSN 1555-7561. - Vol. 5.2010, 3, p. 369-402
|
Publisher: |
New Haven, CT : The Econometric Society |
Subject: | Dynamic stochastic games | Markov perfect equilibrium | regularity | genericity | finiteness | strong stability | essentiality | purifiability | estimation | computation | repeated games |
Saved in:
Type of publication: | Article |
---|---|
Type of publication (narrower categories): | Article |
Language: | English |
Other identifiers: | 10.3982/TE632 [DOI] 895008890 [GVK] hdl:10419/150141 [Handle] RePEc:the:publsh:632 [RePEc] |
Classification: | C73 - Stochastic and Dynamic Games ; C61 - Optimization Techniques; Programming Models; Dynamic Analysis ; C62 - Existence and Stability Conditions of Equilibrium |
Source: |
Persistent link: https://www.econbiz.de/10011599432