‘‘Third down with a yard to go’’: recursive expected utility and the Dixit–Skeath conundrum
نویسندگان
چکیده
In two-outcome strictly competitive games, equilibrium mixed strategies do not depend on ultimate prizes. Dixit and Skeath [Games of Strategy (1999) Norton, New York] find this ‘counter-intuitive’. We show this invariance comes from reduction, not independence; and provide conditions for ‘intuitive’ comparative statics under recursive expected utility. 2001 Elsevier Science B.V. All rights reserved.
منابع مشابه
“ Third down with a yard to go ” : the Dixit - Skeath conundrum on equilibria in competitive
In strictly competitive games, equilibrium mixed strategies are invariant to changes in the ultimate prizes. Dixit & Skeath (1999) argue that this seems counter-intuitive. We show that this invariance is robust to dropping the independence axiom, but is removed if we drop the reduction axiom. The conditions on the resulting recursive expected-utility model to get the desired outcome are analogo...
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