Growth

Rich and Co.

Reality Check: “Equilibrium is not always the right thing you should look for in a game.”

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“In many situations, people do not play equilibrium strategies, instead what they do can look like random or chaotic for a variety of reasons, so it is not always appropriate to base predictions on the equilibrium model.”

“With trading on the stock market, for example, you can have thousands of different stock to choose from, and people do not always behave rationally in these situations or they do not have sufficient information to act rationally. This can have a profound effect on how the markets react.”

“It could be that we need to drop these conventional game theories and instead use new approaches to predict how people might behave.”

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Written by Rich and Co.

June 6, 2016 at 6:55 pm

Posted in Uncategorized

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