The commitment effect in belief evolution

In this note we establish that rational demand expectations will typically not evolve in an evolutionary model. In an evolutionary model, beliefs act like a commitment device to more aggressive behavior. This commitment effect has the same direction for strategic substitutes and complements and fades away in large markets.

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Year of publication:	2003-06
Authors:	Gehrig, Thomas ; Güth, Werner ; Levínský, René
Institutions:	Max-Planck-Institut für Ökonomik, Max-Planck-Gesellschaft

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Extent:	application/pdf
Series:	Papers on Strategic Interaction.
Type of publication:	Book / Working Paper
Notes:	10 pages
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005765164