Corpus ID: 44504078

Player-Compatible Equilibrium

  title={Player-Compatible Equilibrium},
  author={Drew Fudenberg and Kevin He},
  journal={arXiv: Economics},
  • Drew Fudenberg, Kevin He
  • Published 2017
  • Economics
  • arXiv: Economics
  • Player-Compatible Equilibrium (PCE) imposes cross-player restrictions on the magnitudes of the players' "trembles" onto different strategies. These restrictions capture the idea that trembles correspond to deliberate experiments by agents who are unsure of the prevailing distribution of play. PCE selects intuitive equilibria in a number of examples where trembling-hand perfect equilibrium (Selten, 1975) and proper equilibrium (Myerson, 1978) have no bite. We show that rational learning and some… CONTINUE READING

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