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Dynamic Games and Applications

, Volume 6, Issue 3, pp 304–323 | Cite as

Elementary Subpaths in Discounted Stochastic Games

  • Kimmo Berg
Article

Abstract

This paper examines the subgame-perfect equilibria in discounted stochastic games with finite state and action spaces. The fixed-point characterization of equilibria is generalized to unobservable mixed strategies. It is also shown that the pure-strategy equilibria consist of elementary subpaths, which are repeating fragments that give the acceptable action plans in the game. The developed methodology offers a novel way of computing and analyzing equilibrium strategies that need not be stationary nor Markovian.

Keywords

Game theory Stochastic game Subgame-perfect equilibrium Equilibrium path Fixed-point equation Tree 

Notes

Acknowledgments

The author is grateful for the reviewers’ comments and suggestions for improvements. The author acknowledges funding from Emil Aaltosen Säätiö through Post doc -pooli.

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Copyright information

© Springer Science+Business Media New York 2015

Authors and Affiliations

  1. 1.Department of Mathematics and Systems AnalysisAalto University School of ScienceAaltoFinland

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