A subgame property of stable equilibria

A subgame property of stable equilibria

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Article ID: iaor20041117
Country: United States
Volume: 21
Issue: 4
Start Page Number: 991
End Page Number: 999
Publication Date: Nov 1996
Journal: Mathematics of Operations Research
Authors:
Keywords: sets
Abstract:

Stable sets project onto stable sets of subgames in the following sense: stable sets consist of normal form perfect equilibria; of any given ε, we could therefore look at the set of strategy profiles in a subgame that are induced by the set of ε-perfect equilibria in a neighbourhood of a stable set. Now take the limit, as ε goes to zero, of the closures of these sets. It is shown that the set so obtained contains a stable set of the subgame.

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