Evolution in Finitely Repeated Coordination Games
Games and Economic Behaviour, Vol. 34, pp. 312-330, 2001
Posted: 27 Jan 2010
Date Written: 2001
I apply a version of Kandori et al. (1993, Econometrica, 61, 29–56) and Young's (1993, Econometrica, 61, 57–84) evolutionary dynamic to finitely repeated coordination games. The dynamic is modified by allowing mutations to affect only off path beliefs. I find that repetition within a match leads agents to sacrifice current payoffs in order to increase payoffs in later stages. As a consequence, evolution leads to (almost) efficiency.
Keywords: Evolution, Finite repetition, Coordination Games, Path beliefs, Repetition, Efficiency
JEL Classification: C79
Suggested Citation: Suggested Citation