Topics in Economic Theory I (Summer 2011)

OYAMA Daisuke
oyama@e.u-tokyo.ac.jp

This course discusses theories and applications of population games. The topics include myopic evolutionary dynamics and forward-looking expectations dynamics as well as applications to industrialization/economic development and economic geography. If time permits, we also discuss the formal relationship between dynamic games and incomplete information games.

Date	Topic	Reading
5/11 (Wed)	Population games: introduction
5/14 (Sat)	Application: economic geography	Krugman (1991a) Oyama (2009a), Sections 2.1-2.3, 3.1-3.2
5/18 (Wed)	Application: economic geography	Krugman (1991a) Oyama (2009a), Sections 2.1-2.3, 3.1-3.2
5/25 (Wed)	Application: economic geography	Krugman (1991a) Oyama (2009a), Sections 2.1-2.3, 3.1-3.2
6/1 (Wed)	Application: industrialization	Matsuyama (1992)
6/8 (Wed)	Evolutionary dynamics in potential games	Sandholm (2001) Oyama (2009a), Appendix B
6/15 (Wed)	Perfect foresight dynamics in potential games	Hofbauer and Sorger (1999) Oyama (2009a), Appendix C.1
6/22 (Wed)	Perfect foresight dynamics in potential games	Hofbauer and Sorger (1999) Oyama (2009a), Appendix C.2
7/6 (Wed)	Another class of forward-looking expectations dynamics	Krugman (1991b), Fukao and Benabou (1993) Oyama (2009b) Slides
7/13 (Wed)	Robustness of equilibria to incomplete information	Kajii and Morris (1997a, b), Ui (2001) Oyama and Tercieux (2009), Section 3
7/27 (Wed)	Robustness of equilibria to incomplete information	Kajii and Morris (1997a, b), Ui (2001) Oyama and Tercieux (2009), Section 3

Related papers include:

• Fukao, F. and R. Benabou (1993). ``History Versus Expectations: A Comment,'' Quarterly Journal of Economics 108, 535-542.
• Hofbauer, J. and G. Sorger (1999). ``Perfect Foresight and Equilibrium Selection in Symmetric Potential Games,'' Journal of Economic Theory 85, 1-23.
• Hofbauer, J. and G. Sorger (2002). ``A Differential Game Approach to Evolutionary Equilibrium Selection,'' International Game Theory Review 4, 17-31.
• Kajii, A. and S. Morris (1997a). ``The Robustness of Equilibria to Incomplete Information,'' Econometrica 65, 1283-1309.
• Kajii, A. and S. Morris (1997b). ``Refinements and Higher Order Beliefs: A Unified Survey.'' [Download]
• Krugman, P. (1991a). ``Increasing Returns and Economic Geography,'' Journal of Political Economy 99, 483-499.
• Krugman, P. (1991b). ``History versus Expectations,'' Quarterly Journal of Economics 106, 651-667.
• Matsui, A. and K. Matsuyama (1995). ``An Approach to Equilibrium Selection,'' Journal of Economic Theory 65, 415-443.
• Matsuyama, K. (1991). ``Increasing Returns, Industrialization, and Indeterminacy of Equilibrium,'' Quarterly Journal of Economics 106, 617-650.
• Matsuyama, K. (1992). ``The Market Size, Entrepreneurship, and the Big Push,'' Journal of the Japanese and International Economies 6, 347-364.
• Oyama, D. (2009a). ``Agglomeration under Forward-Looking Expectations: Potentials and Global Stability,'' Regional Science and Urban Economics 39, 696-713. [Preprint]
• Oyama, D. (2009b). ``History versus Expectations in Economic Geography Reconsidered,'' Journal of Economic Dynamics and Control 33, 394-408.
• Oyama, D., S. Takahashi, and J. Hofbauer (2008). ``Monotone Methods for Equilibrium Selection under Perfect Foresight Dynamics,'' Theoretical Economics 3, 155-192.
• Oyama, D. and O. Tercieux (2009). ``Iterated Potential and Robustness of Equilibria,'' Journal of Economic Theory 144, 1726-1769.
• Sandholm, W. H. (2001). ``Potential Games with Continuous Player Sets,'' Journal of Economic Theory 97, 81-108.
• Sandholm, W. H. (2011). Population Games and Evolutionary Dynamics, MIT Press.
• Takahashi, S. (2008). ``Perfect Foresight Dynamics in Games with Linear Incentives and Time Symmetry,'' International Journal of Game Theory 37, 15-38.
• Ui, T. (2001). ``Robust Equilibria of Potential Games,'' Econometrica 69, 1373-1380.

See also:

• Hofbauer, J. (2008). ``Perfect Foresight Dynamics: An Interface of Differential Games and Game Dynamics,'' Presentation at Dynamic games, Differential games III in Roscoff, France.
• Oyama, D. (2008). ``History versus Expectations in Large Population Binary Games,'' Presentation at Dynamic games, Differential games III in Roscoff, France.