The Cold Fish War: Long-Term Competition in a Dynamic Game,

Abstract

This paper extends the analysis of cooperative equilibria of the Levhari-Mirman example by using methods developed for repeated games to study equilibria which Pareto-dominate the Cournot-Nash equilibrium of Levhari-Miram. The term Cold War reflects the fact that such cooperative behavior is supported by threats which are not carried out. The first section summarizes the repeated game tools and the results obtained with them. The next section contains the Levhari-Mirman example, and characterizes the cooperative equilibrium outcomes. The third section describes a sufficient condition for subgame perfection of an equilibrium outcome and demonstrates that backwards induction optimality is not implied by perfection, and that there are many desireable perfect equilibria that cannot be constructed by backwards induction. The fourth section describes the perfect equilibria in the nonrenewable or exhaustible resource case. The last section contains a discussion of some limitations and possible extensions.

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Document Details

Document Type
Technical Report
Publication Date
Jan 01, 1984
Accession Number
ADA152747

Entities

People

  • J. A. K. Cave

Organizations

  • RAND Corporation

Tags

Communities of Interest

  • Materials and Manufacturing Processes

DTIC Thesaurus Topics

  • Coefficients
  • Cold War
  • Corporations
  • Equations
  • Extraction
  • Probability
  • Sequences
  • Stationary
  • Steady State

Fields of Study

  • Economics

Readers

  • Game Theory.
  • Mathematical Modeling and Probability Theory.
  • Systems Analysis and Design