David Bourget (Western Ontario)
David Chalmers (ANU, NYU)
Rafael De Clercq
Jack Alan Reynolds
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Theory and Decision 71 (2):175-193 (2011)
We investigate how a group of players might cooperate with each other within the setting of a non-cooperative game. We pursue two notions of partial cooperative equilibria that follow a modification of Nash’s best response rationality rather than a core-like approach. Partial cooperative Nash equilibrium treats non-cooperative players and the coalition of cooperators symmetrically, while the notion of partial cooperative leadership equilibrium assumes that the group of cooperators has a first-mover advantage. We prove existence theorems for both types of equilibria. We look at three well-known applications under partial cooperation. In a game of voluntary provision of a public good we show that our two new equilibrium notions of partial cooperation coincide. In a modified Cournot oligopoly, we identify multiple equilibria of each type and show that a non-cooperator may have a higher payoff than a cooperator. In contrast, under partial cooperation in a symmetric Salop City game, a cooperator enjoys a higher return.
|Keywords||Cooperation Non-cooperative games|
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László Á Kóczy (2007). A Recursive Core for Partition Function Form Games. Theory and Decision 63 (1):41-51.
Thierry Lafay (2010). A Linear Generalization of Stackelberg's Model. Theory and Decision 69 (2):317-326.
Sau-Him Lau & Vai-Lam Mui, Using Turn Taking to Mitigate Coordination and Conflict Problems in the Repeated Battle of the Sexes Game.
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