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Differential Games

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The New Palgrave Dictionary of Economics

Abstract

A differential game studies system dynamics determined by the interactions of agents with divergent purposes. As a limit form of multi-stage games, its non-cooperative solution is subgame perfect; thus it may facilitate the study of credible threats and repeated play. Reducing each stage to a single point in continuous time, differential game applies control theoretic tools (including phase diagrams) to yield results more general and more detailed than other methods. Its applications range from common-property resource utilization to macro-economic stabilization.

This chapter was originally published in The New Palgrave: A Dictionary of Economics, 1st edition, 1987. Edited by John Eatwell, Murray Milgate and Peter Newman

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Clemhout, S., Wan, H.Y. (1987). Differential Games. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95121-5_75-1

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  • DOI: https://doi.org/10.1057/978-1-349-95121-5_75-1

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  • Publisher Name: Palgrave Macmillan, London

  • Online ISBN: 978-1-349-95121-5

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