Learning to Learn, Pattern Recognition, and Nash Equilibrium

The paper studies a large class of bounded-rationality, probabilistic learning models on strategic-form games. The main assumption is that players ‘‘recognize’’ cyclic patterns in the observed history of play. The main result is convergence with probability one to a fixed pattern of pure strategy Nash equilibria, in a large class of ‘‘simple games’’ in which the pure equilibria are nicely spread along the lattice of the game. We also prove that a necessary condition for convergence of behavior to a mixed strategy Nash equilibrium is that the players consider arbitrarily long histories when forming their predictions. Journal of Economic Literature Classification Numbers: C72, D83. Q 1997 Academic Press