SFB 303 Discussion Paper No. B - 427

Author: Hofbauer, Josef, and Karl H. Schlag
Title: Sophisticated Imitation in Cyclic Games
Abstract: Consider a large population of individuals that are repeatedly randomly matched to play a cyclic 2x2 game such as Matching Pennies with fixed roles assigned in the game. Some learn by sampling previous play of a finite number of other individuals in the same role. We analyze population dynamics under optimal boundedly rational behavior (in the sense of Schlag, 1998c). We find that long run play is close to the Nash equilibrium (when few individuals receive information) if and only if the sample size is greater than one.
Keywords: single sampling, multiple sampling, improving, sequential proportional observation, replicator dynamics, aggregate monotone dynamics, Evolutionary Game Theory, Matching Pennies
JEL-Classification-Number: C72, C79
Creation-Date: March, 1998
URL: ../1998/b/bonnsfb427.pdf

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