Nash equilibrium

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Related to Nash strategy: Governing dynamics
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Noun1.Nash equilibrium - (game theory) a stable state of a system that involves several interacting participants in which no participant can gain by a change of strategy as long as all the other participants remain unchanged
game theory, theory of games - (economics) a theory of competition stated in terms of gains and losses among opposing players
equilibrium - a stable situation in which forces cancel one another
References in periodicals archive ?
As the probability that the loss of a boundedly rational firm is compared with the loss of a Nash firm is then equal to the number (measure) of boundedly rational firms that can potentially switch to the Nash strategy at period t + 1 is given by (1 - [[lambda].
10) In fact, Nash firms will immediately switch to being boundedly rational in the next period if the average payoffs for playing the boundedly rational strategy are higher than payoffs for playing the Nash strategy in the current period.
Because of the complex nonlinearity in the coefficients of the Nash strategy, the authors only present the Nash strategy in its implicit forms:
By ruling out the irrational strategies, the game is simplified and a Nash strategy can be determined: this is the best response to the other players' Nash strategies once their non-Nash strategies have been eliminated.
So in this model, litigating in response to litigating is not a Nash strategy.
In short, the factors that prove most important in allowing cooperative solutions to emerge are first, the ability of cooperators to distance themselves from defectors and second, imitation of the strategies that lead to the highest pay-offs in the population, rather than leading to use of what would have been the Nash strategy in the previous iteration.