{"title":"The benefits of coarse preferences","authors":"Joseph Y. Halpern , Yuval Heller , Eyal Winter","doi":"10.1016/j.jebo.2024.106844","DOIUrl":null,"url":null,"abstract":"<div><div>We study the strategic benefits of coarsening one’s utility by clustering payoffs together. Our solution concept, <em>coarse-utility equilibrium (CUE)</em> requires that (1) each player maximizes her coarse utility, given the opponent’s strategy, and (2) the classifications form best replies to one another. We characterize CUEs in various games. In particular, we show that there is a qualitative difference between CUEs in which only one of the players clusters payoffs and those in which all players cluster their payoffs, and that, in the latter type of CUE, players treat other players better than they do in Nash equilibria in games with monotone externalities.</div></div>","PeriodicalId":48409,"journal":{"name":"Journal of Economic Behavior & Organization","volume":"229 ","pages":"Article 106844"},"PeriodicalIF":2.3000,"publicationDate":"2025-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Economic Behavior & Organization","FirstCategoryId":"96","ListUrlMain":"https://www.sciencedirect.com/science/article/pii/S016726812400458X","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0
Abstract
We study the strategic benefits of coarsening one’s utility by clustering payoffs together. Our solution concept, coarse-utility equilibrium (CUE) requires that (1) each player maximizes her coarse utility, given the opponent’s strategy, and (2) the classifications form best replies to one another. We characterize CUEs in various games. In particular, we show that there is a qualitative difference between CUEs in which only one of the players clusters payoffs and those in which all players cluster their payoffs, and that, in the latter type of CUE, players treat other players better than they do in Nash equilibria in games with monotone externalities.
期刊介绍：
The Journal of Economic Behavior and Organization is devoted to theoretical and empirical research concerning economic decision, organization and behavior and to economic change in all its aspects. Its specific purposes are to foster an improved understanding of how human cognitive, computational and informational characteristics influence the working of economic organizations and market economies and how an economy structural features lead to various types of micro and macro behavior, to changing patterns of development and to institutional evolution. Research with these purposes that explore the interrelations of economics with other disciplines such as biology, psychology, law, anthropology, sociology and mathematics is particularly welcome.
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