This paper proposes axiomatic foundations of expectation formation rules, by which deviating players anticipate the reaction of external players in a partition function game. The projection rule is the only rule satisfying subset consistency and responsiveness to the original partition of...

We study the target projection dynamic, a model of learning in normal form games. The dynamic is given a microeconomic foundation in terms of myopic optimization under control costs due to a certain status-quo bias. We establish a number of desirable properties of the dynamic: existence,...

In classical game theory, players have finitely many actions and evaluate outcomes of mixed strategies using a von Neumann-Morgenstern utility function. Allowing a larger, but countable, player set introduces phenomena that are impossible in finite games: Even if players have identical payoffs...