Games with Procedurally Rational Players

Martin J. Osborne, Ariel Rubinstein

Research output: Contribution to journalArticlepeer-review

Abstract

We study interactive situations in which players are boundedly rational. Each player, rather than optimizing given a belief about the other players' behavior, as in the theory of Nash equilibrium, uses the following choice procedure. She first associates one consequence with each of her actions by sampling (literally or virtually) each of her actions once. Then she chooses the action that has the best consequence. We define a notion of equilibrium for such situations and study its properties.

Original languageEnglish
Pages (from-to)834-847
Number of pages14
JournalAmerican Economic Review
Volume88
Issue number4
StatePublished - Sep 1998

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