Economic Theory

, Volume 42, Issue 1, pp 255–269

Computing sequential equilibria using agent quantal response equilibria

Symposium

DOI: 10.1007/s00199-009-0443-3

Cite this article as:
Turocy, T.L. Econ Theory (2010) 42: 255. doi:10.1007/s00199-009-0443-3

Abstract

The limit of any convergent sequence of agent quantal response equilibria is a sequential equilibrium of an extensive game. Using a logarithmic transformation of action probabilities, it is numerically feasible and practical to compute such sequences, and thereby compute good approximations to sequential equilibrium assessments. This paper describes the algorithm to compute the sequences, and outlines the convergence and selection properties of the method.

Keywords

Computing Nash equilibrium Quantal response Homotopy methods 

JEL Classification

C63 C72 

Copyright information

© Springer-Verlag 2009

Authors and Affiliations

  1. 1.Department of EconomicsTexas A&M UniversityCollege StationUSA