Jorge Cortés
Professor
Cymer Corporation Endowed Chair
Evolution of players' misperceptions in hypergames under
perfect observations
B. Gharesifard and J. Cortés
IEEE Transactions on Automatic Control 57 (7) (2012), 1641-1656
Abstract
This paper considers games of incomplete information and studies the
evolution of the (not necessarily consistent) perceptions of the
players using the framework of hypergames. The focus is on
developing methods to modify the players' perception about other
players' preferences by incorporating the lessons learned from
observing their actions. If players are rational, our first update
mechanism, called swap learning, is guaranteed to decrease the
mismatch between a player's perception and the true payoff structure
of other players. However, this method can lead to inconsistencies
in the stability properties of the resulting perception. This
motivates the introduction of a second update mechanism, called
modified swap learning, that is guaranteed to produce a consistent
perception. We also identify a class of hypergames for which
modified swap is also guaranteed to decrease the mismatch in a
player's perception. We introduce the novel notion of H-digraph as
a useful tool to encode the information in a hypergame, and fully
characterize how this digraph is affected by changes in the players'
beliefs.
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Mechanical and Aerospace Engineering,
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