Abstract
We exhibit a large class of simple rules of behavior, which we call adaptive heuristics, and show that they generate rational behavior in the long run. These adaptive heuristics are based on natural regret measures, and may be viewed as a bridge between rational and behavioral viewpoints. Taken together, the results presented here establish a solid connection between the dynamic approach of adaptive heuristics and the static approach of correlated equilibria.
Original language | English |
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Pages (from-to) | 1401-1430 |
Number of pages | 30 |
Journal | Econometrica |
Volume | 73 |
Issue number | 5 |
DOIs | |
State | Published - Sep 2005 |
Keywords
- Adaptive
- Approachability
- Behavioral
- Bounded rationality
- Calibration
- Correlated equilibrium
- Dynamics
- Fictitious play
- Heuristics
- Joint distribution of play
- Regret
- Regretmatching
- Uncoupled dynamics