Bayesian learning and convergence to Nash equilibria without common priors

Research output: Contribution to journalArticle

Abstract

Consider an infinitely repeated game where each player is characterized by a "type" which may be unknown to the other players in the game. Suppose further that each player's belief about others is independent of that player's type. Impose an absolute continuity condition on the ex ante beliefs of players (weaker than mutual absolute continuity). Then any limit point of beliefs of players about the future of the game conditional on the past lies in the set of Nash or Subjective equilibria. Our assumption does not require common priors so is weaker than Jordan (1991); however our conclusion is weaker, we obtain convergence to subjective and not necessarily Nash equilibria. Our model is a generalization of the Kalai and Lehrer (1993) model. Our assumption is weaker than theirs. However, our conclusion is also weaker, and shows that limit points of beliefs, and not actual play, are subjective equilibria.

Original languageEnglish (US)
Pages (from-to)643-655
Number of pages13
JournalEconomic Theory
Volume11
Issue number3
StatePublished - May 1998

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Nash equilibrium
Common priors
Bayesian learning
Continuity
Jordan
Infinitely repeated games

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Bayesian learning and convergence to Nash equilibria without common priors. / Nyarko, Yaw.

In: Economic Theory, Vol. 11, No. 3, 05.1998, p. 643-655.

Research output: Contribution to journalArticle

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