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STABILITY OF A DUAL APPROACH FOR GENERALIZED QUASI-VARIATIONAL INEQUALITIES.
No full textThe aim of this paper is to investigate, in the case of finite dimensional spaces, the stability of a duality scheme as well as of generalized Kuhn-tucker conditions
On Games and Equilibria with Coherent Lower Expectations
Full text linkDifferent solution concepts for strategic form games have been introduced in order to weaken the consistency assumption that players’ beliefs, about their opponents strategic choices, are correct in equilibrium. The literature has shown that ambiguous beliefs are an appropriate device to deal with this task. In this note, we introduce an equilibrium concept in which players do not know the opponents’ strategies in their entirety but only the coherent lower expectations of some random variables that depend on the actual strategies taken by the others. This equilibrium concept generalizes the already existing concept of equilibrium with partially specified probabilities by extending the set of feasible beliefs and allowing for comparative probability judgements. We study the issue of the existence of the equilibrium points in our framework and find sufficient conditions which involve the continuity of coherent lower expectations and a Slater-like condition for the systems of inequalities defining beliefs
Variational preferences and equilibria in games under ambiguous belief correspondences
No full textVariational preferences have been introduced to study the robustness of macroeconomic models with respect to ambiguity. The Decision Theory literature has shown that this family of preferences provides a tractable and flexible tool in order to deal with this kind of uncertainty in general settings. In fact, variational preferences are equipped with an accurate and explicit parametrization of the decision maker’s attitude towards ambiguity, which is indeed represented by a cost function of the probabilities (called index of ambiguity aversion). In the present work, we study the effect of variational preferences in strategic form games under ambiguity in which players’ uncertainty is expressed entirely in the space of lotteries over consequences by belief correspondences of the strategy profile chosen by the agents. We focus on primary theoretical issues related to this model that constitute a required background for applications or numerical methods. First, we give a general equilibrium existence result that we apply to a particular model in which belief correspondences depend on the equilibria of specific subgames. Other numerical examples are presented to show the model applicability. Finally, we look at the consequences of parameter changes on equilibrium predictions and study the limit behavior of equilibria under perturbations on the index of ambiguity aversion and belief correspondences. All the results are sufficiently general to be a useful tool in any interdisciplinary problem in which strategic interaction is affected by ambiguity
A Temporary Recalibration of Executive – Legislative Relations on EU Trade Agreements? The Case of National and Regional Parliaments on CETA and TTIP
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