Group for Research in Decision Analysis

Conjectural Variations Equilibria, Part I: Static Equilibria

Alain Jean-Marie Centre de Recherche de Sophia-Antipolis Méditerranée, INRIA, France

This talk is an introduction to the Conjectural Variations Equilibria, a Game Theory concept in which players make assumptions on the behavior of their opponents.

We shall describe this concept for static games, elicit its relationship with the Nash Equilibrium and Pareto-Efficient outcomes, discuss the notion of "consistency" of the conjectures, and explain how such equilibria can be seen as shortcuts for certain dynamic games.

Illustrations will be taken from models in Economics: Oligopoly Theory, or the voluntary contributions to public goods.