Thomas Schwartz

(UCLA, Los Angeles, CA 90095, USA)

 

 

Abstract: Rational interplay does not always equilibrate, even assuming complete information, common knowledge, and a unique pure-strategy Nash equilibrium. One reason is that players sometimes are indifferent between equilibrium and other strategies. Another is that a fine enough division of opportunity into distinct strategies can efface equilibria that coarser divisions reveal. A revised equilibrium concept escapes these problems.

 

Key words: game theory; Nash equilibrium

 

JEL code: C7