Acceptable Versus Straightforward Game Forms: An Example
Review of Economic Studies
1983
This paper is concerned with the design of non-cooperative game forms for economic decision problems. A decision problem is presented which admits non-dictatorial game forms with the following properties: Nash equilibria exist and all Nash equilibrium outcomes are Pareto optimal; or dominant strategies exist and all dominant strategy equilibria are Pareto optimal; but not both. This is, any (non-dictatorial) game form whose Nash equilibria are well behaved does not have dominant strategies, and any game form with well behaved dominant strategy equilibria must have at least one non-optimal non-dominant strategy Nash equilibrium.
- DOI
- 10.2307/2297422
- Volume
- 50 (2)
- Pages
- 369
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