Institutions, the way they are related to the behaviour of the agents and to the aggregated performance of socio-economic systems, are the topic addressed by this essay. The research is based on a particular concept of a bounded rational agent living in society and by a population based simulation model that describes the processes of social learning. From simple co-ordination problems, where c...

We present infinite extensive strategy profiles with perfect information and we show that replacing finite by infinite changes the notions and the reasoning tools. The presentation uses a formalism recently developed by logicians and computer science theoreticians, called coinduction. This builds a bridge between economic game theory and the most recent advance in theoretical computer science a...

Several studies of two-party negotiations have shown that negotiators more often than not reach inefficient compromises. We analyze the circumstances under which rational agents make inefficient compromises and refrain from improving them. We do this by describing and interpreting various negotiation situations and by developing formal constructs and theorems for determining the character of a ...

Logit dynamics [Blume, Games and Economic Behavior, 1993] is a randomized best response dynamics where at every time step a player is selected uniformly at random and she chooses a new strategy according to the “logit choice function”, i.e. a probability distribution biased towards strategies promising higher payoffs, where the bias level corresponds to the degree of rationality of the agents. ...

Over recent years there has been a worldwide trend towards smaller government government departments being under increased pressure to privatise or outsource parts of their operation and to move towards a more independent corporatised model. The corporatised model is seen to involve the organisation moving away from being a direct arm of the government, acting more as a business entity in their...

The effect of organizational communication structure on performance is studied using a project selection framework in which heterogeneous, rational agents can reject or accept projects. A hierarchy performs better than a polyarchy in tough environments, whereas the reverse holds in friendly environments. Hierarchies can be too strict from a social welfare point of view. Indeed, if the value of ...

The article introduces a modal logic for reasoning about combined effect of economic policies imposed on a group of rational agents. Modalities in this language are labeled by policies applied to the players in a strategic game. The resulting logical system allows to reason about properties that are true in all Nash equilibria of the game modified by a specific policy. The main technical result...

This paper intends to be a contribution towards an evolutionary theory of consumer. Standard economic theory assumes perfectly rational agents acting upon exogenously given preferences. Here it is proposed a bounded rational representation of consumers, which seems even more justified for consumers than for producers since they are not subject to competitive pressures and there cannot exist any...

1. The Problem and Related Literature In our daily lives, we always face decisions to make and alternative actions to choose overtime. Traditional economic analysis expects people behave rationally (take actions maximizing their payoff or utility) and thus behave consistently (following the original contingent plan or strategy) when they make these decisions. In other words, a rational agent's ...

We discuss the Minority Game, a model of heterogeneous, indictive rational agents inspired by the El Farol Bar problem. We derive the exact solution of the model in the limit of infinitely many agents using tools of statistical physics of disordered systems. Our results show that the impact of agents on the collective behavior plays a key role: even though for each agent this effect is very sma...