Evolutionary game theory has largely focused on finite games. Dynamic stability is harder to attain in infinite strategy spaces; Bomze (Monatshefte für Mathematik 110, 1990, 189–206) and Oechssler and Riedel (Economic Theory 17, 2001, 141–162) provide conditions for the stability of rest points under the replicator dynamics. Here, conditions are given for the stability of sets of strategies und...

We consider “social contracts” which alter the payoffs of players in a noncoperative game, generating new Nash Equilibria (NE). In the domain of contracts which — in conjunction with their concomitant NE — are “self-financing”, our focus is on those that are (Pareto) optimal. By way of a key example, we examine optimal levels of crime and punishment in a population equilibrium. JEL Classificati...

In a common-values election with two candidates voters receive a signal about which candidate is superior. They can acquire information that improves the precision of the signal. Electors differ in their information acquisition costs. For large electorates a non negligible fraction of voters acquires information, but the quantity of informed voters and the quality of acquired information declin...

In this paper we present a model of implementation based on the idea that agents renegotiate unfeasible allocations. We characterize the maximal set of Social Choice Correspondences that can be implemented in Nash Equilibrium with a class of renegotiation functions that do not reward agents for unfeasibilities. This result is used to study the possibility of implementing the Walrasian Correspon...

In this paper the Signalling approach to the explanation of wage di®erentials is analyzed both under a microeconomic and a macroeconomic viewpoint. Departuring from the classical Spence's model, the introduction of inequalities in accessing to education leads to redistributive e®ects among workers and ̄rms. Moreover the existence of factors related both to local and to parental externalities gr...

We characterize the outcomes of games when players may make binding o ers of strategy contingent side payments before the game is played. This does not always lead to eÆcient outcomes, despite complete information and costless contracting. The characterizations are illustrated in a series of examples, including voluntary contribution public good games, Cournot and Bertrand oligopoly, principal-...

Sufficient conditions for pure-strategy Nash equilibria of finite games to be Ž . Lyapunov stable under a large class of evolutionary dynamics, the regular monotonic selection dynamics, are discussed. In particular, it is shown that in almost all finite extensive-form games, all the pure-strategy equilibria are stable. In such games, all mixed-strategy equilibria close to pure-strategy equilibr...

Recently Yang and Qi (2013) stated an interesting theorem on the existence of complete lattice of equilibria in a particular class of large nonatomic supermodular games for general action and players spaces. Unfortunately, their result is incorrect. In this note, we detail the nature of the problem with the stated theorem, provide a counterexample, and then correct the result under additional a...

This paper provides a learning justification for limited forecast equilibria, i.e., Ž . strategy profiles such that 1 players choose their actions in order to maximize the discounted average payoff over their horizon of foresight as given by their forecasts Ž . and 2 forecasts are correct on and off the equilibrium path. The limited forecast equilibria appear to be the stochastically stable out...

We introduce product differentiation in the model of price competition with strictly convex costs in which firms have to supply all the forthcoming demand. We find that although a continuum of equilibria exists in a homogeneous product market, the competitive price equilibrium is the only robust one. Specifically, as long as the equilibrium correspondence is nonempty, the equilibrium price conv...