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#Post#: 21--------------------------------------------------
NE and strictly dominated strategies
DIR By: Julia.Wirtz
Date: November 22, 2012, 7:09 am
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I'm posting a question I got per email and my answer:
Question
1) Can I solve NE as combinations of Best Response instead of
using
iterative elimination of (strictly) dominated stratedies?
In Prof. Muthoo's lecture, we found NE using iterative
elimination of
dominated strategies, but if the solution is the same, I think
it's
more to use BR to find pure strategy NE.
2) When we solve mixed strategy NE in a game which have more
than
two players (e.g. 3×3, 4×4), can I eliminate strictly dominated
strategies first before setting probability which make the other
player's strategies equivalent?
In solving (j) in the question 4., I solved it like that.
Otherwise, I
think we have to use linear programming to solve 3×3 or 4×4
games.
Answer
1) Yes, that's the easiest way for PSNE
However, if you have a large game and are looking out for MSNE,
it
helps to eliminate STRICTLY dominated strategies, since it makes
the
game easier and STRICTLY dominated strategies will never be part
of a
MSNE
Do not eliminate WEAKLY dominated strategies, since they could
be part of a NE
2) yes (see above), but note that in (j) you only have 2 players
with 4 ACTIONS each
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