A characterization of quasi-perfect equilibria
Authors:
Nicola Gatti, Mario Gilli, Alberto Marchesi
Journal:
Games and Economic Behavior
Abstract:
We provide a characterization of quasi-perfect equilibria in n-player games, showing that any quasi-perfect equilibrium can be obtained as limit point of a sequence of Nash equilibria of a certain class of perturbed games in sequence form, and any limit point of a sequence of Nash equilibria of these perturbed games is a quasi-perfect equilibrium. We prove that, in games with three or more players, we need trembles defined as rational functions of the perturbation magnitude ε, whereas, in two-player games with nature, trembles expressed in terms of polynomial functions of ε suffice. Exploiting the relationship between sequence form and extensive form, we also provide a similar characterization in terms of perturbed games in extensive form, though not compliant with Selten’s definition of perturbed game.