In many markets it is possible to find rival sellers charging different prices for the same good. Earlier research has explained this phenomenon by demon-strating the existence of dispersed price equilibria when consumers must make use of costly search to discover prices. Taking as a starting...

This paper considers a version of Bush and Mosteller's stochastic learning theory in the context of games. We compare this model of learning to a model of biological evolution. The purpose is to investigate analogies between learning and evolution. We and that in the continuous time limit the...

A finite population of agents playing a 2 x 2 symmetric game evolves by adaptive best response. The assumption that players make mistakes is dropped in favor of one where players differ, via payoff heterogeneity. Arbitrary mutations are thus replaced with an economically justified specification....

This risk.paper considers a simple learning process for decision problems under All behaviour change derives from the reinforcing or deterring effect of instantaneous payoff experiences. Payoff experiences are reinforcing or deterring depending on whether the payoff exceeds an aspiration level...

Fictitious play and "gradient" learning are examined in the context of a large population where agents are repeatedly randomly matched. We show that the aggregation of this learning behaviour can be qualitatively di®erent from learning at the level of the individual. This aggregate dynamic...