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Non-cooperative game

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A system

where is the set of players, is the set of strategies (cf. Strategy (in game theory)) of the -th player and is the gain function of the -th player, defined on the Cartesian product . A non-cooperative game is played as follows: players, who are acting individually (do not form a coalition, do not cooperate), select their strategies , as a result of which the situation appears, in which the -th player obtains the gain . The main optimality principle in a non-cooperative game is the principle of realizability of the objective [1], which generates the Nash equilibrium solutions. A solution is called an equilibrium solution if for all , , the inequality

where , is valid. Thus, none of the players is interested in unilaterally disturbing the equilibrium solution previously agreed upon between them. It has been proved (Nash's theorem) that a finite non-cooperative game (the sets and are finite) possesses an equilibrium solution for mixed strategies. This theorem has been generalized to include infinite non-cooperative games with a finite number of players [3] and non-cooperative games with an infinite number of players (cf. Non-atomic game).

Two equilibrium solutions and are called interchangeable if any solution , where or , , is also an equilibrium solution. They are called equivalent if for all . Let be the set of all equilibrium solutions, and let be the set of equilibrium solutions which are Pareto optimal (cf. Arbitration scheme). A game is called Nash solvable and is said to be a Nash solution if all are equivalent and interchangeable. A game is called strictly solvable if is non-empty and all are equivalent and interchangeable. Two-person zero-sum games (cf. Two-person zero-sum game) with optimal strategies are Nash solvable and strictly solvable; however, in the general case such a solvability is often impossible.

Other attempts at completing the principle of realizability of the objective were made. Thus, it was suggested [4] that the unique equilibrium solution or the maximum solution (in this last situation each player may ensure his/her own gain irrespective of the strategies chosen by the other players), the choice of which is based on the introduction of a new preference relation on the set of solutions, be considered as the solution of the non-cooperative game. In another approach the solution of a non-cooperative game is defined by a subjective prognosis of the behaviour of the players [5].

References

[1] N.N. Vorob'ev, "The present state of the theory of games" Russian Math. Surveys , 25 : 2 (1970) pp. 77–136 Uspekhi Mat. Nauk , 25 : 2 (1970) pp. 81–140
[2] J. Nash, "Noncooperative games" Ann. of Math. , 54 (1951) pp. 286–295
[3] I.L. Glicksberg, "A further generalization of the Kakutani fixed point theorem, with application to Nash equilibrium points" Proc. Amer. Math. Soc. , 3 (1952) pp. 170–174
[4] J.C. Harsanyi, "A general solution for finite noncooperative games based on risk-dominance" L.S. Shapley (ed.) A.W. Tucker (ed.) M. Dresher (ed.) , Advances in game theory , Princeton Univ. Press (1964) pp. 651–679
[5] E.I. Vilkas, "The axiomatic definition of equilibrium points and the value of a non-coalition -person game" Theory Probab. Appl. , 13 : 3 (1968) pp. 523–527 Teor. Veroyatnost. i Primenen. , 13 : 3 (1968) pp. 555–560


Comments

References

[a1] N.N. Vorob'ev, "Game theory. Lectures for economists and system scientists" , Springer (1977) (Translated from Russian)
How to Cite This Entry:
Non-cooperative game. E.I. VilkasE.B. Yanovskaya (originator), Encyclopedia of Mathematics. URL: http://www.encyclopediaofmath.org/index.php?title=Non-cooperative_game&oldid=17485
This text originally appeared in Encyclopedia of Mathematics - ISBN 1402006098