Scandinavian Working Papers in Economics

SSE/EFI Working Paper Series in Economics and Finance,
Stockholm School of Economics

No 542: Probabilistic choice in games: properties of Rosenthal's t-solutions

Mark Voorneveld ()
Additional contact information
Mark Voorneveld: Dept. of Economics, Stockholm School of Economics, Postal: Stockholm School of Economics, P.O. Box 6501, SE-113 83 Stockholm, Sweden

Abstract: In t-solutions, quantal response equilibria based on the linear probability model as introduced in R.W. Rosenthal (1989, Int. J. Game Theory 18, 273-292), choice probabilities are related to the determination of leveling taxes. The set of t-solutions coincides with the set of Nash equilibria of a game with quadratic control costs. Increasing the rationality of the players allows them to successively eliminate higher levels of strictly dominated actions. Moreover, there exists a path of t-solutions linking uniform randomization to Nash equilibrium.

Keywords: quantal response equilibrium; t-solutions; linear probability model

JEL-codes: C72

15 pages, First version: October 28, 2003. Revised: December 20, 2003. Earlier revisions: October 31, 2003.

Full text files 

hastef0542.pdf PDF-file Full text

Download statistics

Questions (including download problems) about the papers in this series should be directed to Helena Lundin ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2024-02-11 18:19:15.