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Article

A Generalization of Quantal Response Equilibrium via Perturbed Utility

by 1,‡ and 2,*,‡
1
Department of Economics, University of Western Ontario, London, ON N6A 5C2, Canada
2
Department of Economics, The Ohio State University, Columbus, OH 43210, USA
*
Author to whom correspondence should be addressed.
We thank P.J. Healy for useful comments. Any mistakes are our own.
These authors contributed equally to this work.
Academic Editors: Yusufcan Masatlioglu and Ulrich Berger
Received: 29 December 2020 / Revised: 8 February 2021 / Accepted: 19 February 2021 / Published: 1 March 2021
(This article belongs to the Special Issue Limited Attention)
We present a tractable generalization of quantal response equilibrium via non-expected utility preferences. In particular, we introduce concave perturbed utility games in which an individual has strategy-specific utility indices that depend on the outcome of the game and an additively separable preference to randomize. The preference to randomize can be viewed as a reduced form of limited attention. Using concave perturbed utility games, we show how to enrich models based on logit best response that are common from quantal response equilibrium. First, the desire to randomize can depend on opponents’ strategies. Second, we show how to derive a nested logit best response function. Lastly, we present tractable quadratic perturbed utility games that allow complementarity. View Full-Text
Keywords: quantal response equilibrium; non-expected utility; limited attention quantal response equilibrium; non-expected utility; limited attention
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MDPI and ACS Style

Allen, R.; Rehbeck, J. A Generalization of Quantal Response Equilibrium via Perturbed Utility. Games 2021, 12, 20. https://0-doi-org.brum.beds.ac.uk/10.3390/g12010020

AMA Style

Allen R, Rehbeck J. A Generalization of Quantal Response Equilibrium via Perturbed Utility. Games. 2021; 12(1):20. https://0-doi-org.brum.beds.ac.uk/10.3390/g12010020

Chicago/Turabian Style

Allen, Roy, and John Rehbeck. 2021. "A Generalization of Quantal Response Equilibrium via Perturbed Utility" Games 12, no. 1: 20. https://0-doi-org.brum.beds.ac.uk/10.3390/g12010020

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