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We examine how the speed of learning and best-response processes depends on homophily: the tendency of agents to associate disproportionately with those having similar traits. When agents' beliefs or behaviors are developed by averaging what they see among their neighbors, then convergence to a consensus is slowed by the presence of homophily, but is not(More)
We investigate the representative consumer's risk attitude and efficient risk-sharing rules in a single-period, single-good economy in which consumers have homogeneous prob-abilistic belief but heterogeneous risk attitudes. Of our two formulas regarding the representative consumer's risk attitude, the first one implies that if all consumers' relative risk(More)
Nöldeke and Samuelson (1993) investigate a stochastic evolutionary model for extensive form games and show that even for games of perfect information with a unique subgame perfect equilibrium, non-subgame perfect equilibrium-strategies may well survive in the long run even when mutation rates tend to zero. In a different model of evolution in the agent(More)
This paper provides an in-depth study of the (most) refined best-reply correspondence introduced by Balkenborg, Hofbauer, and Kuzmics (2009a). We study notions of strict and weak dominance most appropriate to it, its fixed points, and rationalizability based on it, and how these concepts are related to well-known concepts such as, among others, Selten's(More)
We study symmetric play in a class of repeated games when players are patient. We show that, while the use of symmetric strategy profiles essentially does not restrict the set of feasible payoffs, the set of equilibrium payoffs is an interesting proper subset of the feasible and individually rational set. We also provide a theory of how rational individuals(More)
This paper analyzes a stochastic best reply evolutionary model with inertia in normal form games. The long-run behavior of individuals in this model is investigated in the limit where experimentation rates tend to zero, while the expected number of experimenters, and hence also population sizes, tend to infinity. Conditions on the learning-rate which are(More)