Structural Models of Nonequilibrium Strategic Thinking: Theory, Evidence, and Applications

摘要: Most applications of game theory assume equilibrium, justified by presuming either that learning will have converged to one, or equilibrium approximates people’s strategic thinking even when a justification is implausible. Yet several recent experimental and empirical studies suggest initial responses games often deviate systematically from structural nonequilibrium “level-k” “cognitive hierarchy” models out-predict equilibrium. Even possible converges such allow better predictions history-dependent limiting outcomes. This paper surveys evidence on illustrates the level-k in economics. (JEL C70, D03, D82, D83)