Abstract
We develop a framework for analyzing multidimensional reasoning in strategic interactions, which is motivated by two experimental findings: (i) in games with a large and complex strategy space, players tend to think in terms of strategy characteristics rather than the strategies themselves; (ii) in their strategic deliberation, players consider one characteristic at a time. A multidimensional equilibrium is a vector of characteristics representing a stable mode of behavior: a player does not wish to modify any one characteristic. The concept is applied to several economic interactions, where a vector of characteristics, rather than a distribution of strategies, is identified as stable.
Original language | English |
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Pages (from-to) | 285-318 |
Number of pages | 34 |
Journal | American Economic Journal: Microeconomics |
Volume | 11 |
Issue number | 3 |
DOIs | |
State | Published - Aug 2019 |
All Science Journal Classification (ASJC) codes
- Economics, Econometrics and Finance(all)
- General Economics,Econometrics and Finance