Game Theory, Conditional Preferences, and Social Influence

PLOS ONE, Vol. 8, No. 2, February 2013

11 Pages Posted: 28 Apr 2013

See all articles by Wynn Stirling

Wynn Stirling

Brigham Young University

Teppo Felin

University of Oxford - Said Business School; Utah State University - Huntsman School of Business

Date Written: 2013

Abstract

Neoclassical noncooperative game theory is based on a simple, yet powerful synthesis of mathematical and logical concepts: unconditional and immutable preference orderings and individual rationality. Although this structure has proven useful for characterizing competitive multi-player behavior, its applicability to scenarios involving complex social relationships is problematic. In this paper we directly address this limitation by the introduction of a conditional preference structure that permits players to modulate their preference orderings as functions of the preferences of other players. Embedding this expanded preference structure in a formal and graphical framework provides a systematic approach for characterizing a complex society. The result is an influence network that allows conditional preferences to propagate through the community, resulting in an emergent social model which characterizes all of the social relationships that exist and which leads to solution concepts that account for both group and individual interests. The Ultimatum game is presented as an example of how social influence can be modeled with conditional preferences.

Keywords: game theory, social influence, conditional preferences

JEL Classification: C7

Suggested Citation

Stirling, Wynn and Felin, Teppo, Game Theory, Conditional Preferences, and Social Influence (2013). PLOS ONE, Vol. 8, No. 2, February 2013, Available at SSRN: https://ssrn.com/abstract=2257286

Wynn Stirling

Brigham Young University ( email )

Provo, UT 84602
United States

Teppo Felin (Contact Author)

University of Oxford - Said Business School ( email )

Park End Street
Oxford, OX1 1HP
Great Britain

HOME PAGE: http://sites.google.com/site/teppofelin2/

Utah State University - Huntsman School of Business ( email )

3500 Old Main Hill
Logan, UT 84322-3500
United States

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