Establishing the existence of Nash equilibria for partially observed stochastic dynamic games is known to be quite challenging, with the difficulties stemming from the noisy nature of the measurements available to individual players (agents) and the decentralized nature of this information. When the number of players is sufficiently large and the interactions among agents is of the mean-field t...

We investigate the dynamics of a delayed stochastic mathematical model to understand the evolution of the alcohol consumption in Spain. Sufficient condition for stability in probability of the equilibrium point of the dynamic model with aftereffect and stochastic perturbations is obtained via Kolmanovskii and Shaikhet general method of Lyapunov functionals construction. We conclude that alcohol...

Fully rational agents are allowed to optimize over expectations formation technologies in an environment where it is costly to collect and process information. It is shown in a general equilibrium framework that optimization over expectations by rational and forward oriented agents can lead to endogenous instability. Specifically, we illustrate that resulting equilibria can be both chaotic and ...

This paper establishes existence of a stationary Markov perfect equilibrium in general stochastic games with noise — a component of the state that is nonatomically distributed and not directly affected by the previous period’s state and actions. Noise may be simply a payoff-irrelevant public randomization device, delivering known results on existence of correlated equilibrium as a special case....