Related papers: Les crashs sont rationnels
We show how solution concepts in games such as Nash equilibrium, correlated equilibrium, rationalizability, and sequential equilibrium can be given a uniform definition in terms of \emph{knowledge-based programs}. Intuitively, all solution…
There is a common belief that humans and many animals follow transitive inference (choosing A over C on the basis of knowing that A is better than B and B is better than C). Transitivity seems to be the essence of rational choice. We…
In this paper, we analyse inspection games with an evolutionary perspective. In our evolutionary inspection game with a large population, each individual is not a rational payoff maximiser, but periodically updates his strategy if he…
We study a rational expectation model of bubbles and crashes. The model has two components : (1) our key assumption is that a crash may be caused by local self-reinforcing imitation between noise traders. If the tendency for noise traders…
Expanding the ideas of the author's paper 'Nonexpansive maps and option pricing theory' (Kibernetica 34:6 (1998), 713-724) we develop a pure game-theoretic approach to option pricing, by-passing stochastic modeling. Risk neutral…
No-regret learners seek to minimize the difference between the loss they cumulated through the actions they played, and the loss they would have cumulated in hindsight had they consistently modified their behavior according to some strategy…
Modern economies evolved from simpler human exchanges into very convoluted systems. Today, a multitude of aspects can be regulated, tampered with, or left to chance; these are economic {\em degrees of freedom} which together shape the flow…
Algorithmic stablecoins (AS) are one special type of stablecoins that are not backed by any asset (equiv. without collateral). They stand to revolutionize the way a sovereign fiat operates. As implemented, these coins are poorly stabilized…
In this paper, we present a family of a control-stopping games which arise naturally in equilibrium-based models of market microstructure, as well as in other models with strategic buyers and sellers. A distinctive feature of this family of…
We study pure coordination games where in every outcome, all players have identical payoffs, 'win' or 'lose'. We identify and discuss a range of 'purely rational principles' guiding the reasoning of rational players in such games and…
Abrupt shifts in ecosystems, brains, markets, and climate are often diagnosed as signs of approaching a tipping point, i.e. a critical bifurcation where stability is lost. Here we reveal a broader and more deceptive mechanism:…
We derive robust predictions in games involving flexible information acquisition, also known as rational inattention (Sims 2003). These predictions remain accurate regardless of the specific methods players employ to gather information.…
Game semantics provides an interactive point of view on proofs, which enables one to describe precisely their dynamical behavior during cut elimination, by considering formulas as games on which proofs induce strategies. We are specifically…
The interplay between criminal organizations and law enforcement disruption strategies is crucial in criminology. Criminal enterprises, like legitimate businesses, balance visibility and security to thrive. This study uses evolutionary game…
This paper argues that the finite horizon paradox, where game theory contradicts intuition, stems from the limitations of standard number systems in modelling the cognitive perception of infinity. To address this issue, we propose a new…
Infinitely repeated games support equilibrium concepts beyond those present in one-shot games (e.g., cooperation in the prisoner's dilemma). Nonetheless, repeated games fail to capture our real-world intuition for settings with many…
This paper casts within a unified economic framework some key challenges for the global economic order: de-globalization; the rising impracticability of global cooperation; and the increasingly confrontational nature of Great Power…
Humans are bounded rational at best and this, we argue, has worked in their favour in the hunter-gatherer society where emergence of a coordinated action, leading to cooperation, is otherwise the standard stag-hunt dilemma (when individuals…
In game theory, the concept of Nash equilibrium reflects the collective stability of some individual strategies chosen by selfish agents. The concept pertains to different classes of games, e.g. the sequential games, where the agents play…
In dynamic settings each economic agent's choices can be revealing of her private information. This elicitation via the rationalization of observable behavior depends each agent's perception of which payoff-relevant contingencies other…