μ–σ GAMES

μ–σ Games

μ–σ Games

Blog Article

Risk aversion in game theory is usually modeled using expected utility, which was criticized early on, leading to an teal horse blanket extensive literature on generalized expected utility.In this paper we are the first to apply μσ theory to the analysis of (static) games.μσ theory is widely accepted in the finance literature; using it allows us harry potter magsafe case to study the effect on uncertainty endogenous to the game, i.e.

, mixed equilibria.In particular, we look at the case of linear μσ utility functions and determine the best response strategy.In the case of 2 × 2 and N × M games, we are able to characterize all mixed equilibria.

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