In game theory, a subgame perfect equilibrium (SPE), or subgame perfect Nash equilibrium (SPNE), is a refinement of the Nash equilibrium concept, specifically designed for dynamic …

Strategy in a SPNE must be a best-response at each node, given the strategies of other players Backward Induction 10/26

A subgame perfect Nash equilibrium (SPNE) is a strategy profile that induces a Nash equilibrium on every subgame • Since the whole game is always a subgame, every SPNE is a Nash …

Notice that every SPNE must also be a NE, because the full game is also a subgame. For finite games of perfect information, any backward induction solution is a SPNE and vice-versa. The …

Compute a Nash equilibrium of this game. Assign the payoff vector associated with this equilibrium to the starting node, and eliminate the subgame. Iterate this procedure until a …

Subgame: Given an extensive form game, a node x is said to initiate a subgame if neither x nor any of its successors are in an information set that contains nodes that are not successors of …

Game tree •Thsi is a dynamic game of perfect information. • We solve it using backward induction.

Each game possesses at least one subgame: the game tree itself. Each subgame different from the game itself is called a proper subgame.

• The game has a known end, so a finite game tree • But we know how to solve these games, more precisely, how to find a SPNE: –By backward induction: start at the end and move …

May 7, 2023 · My problem: I was looking at the exercise 3 with the game trees 1-3. I do understand that I need to solve for the SPNE by using backwards induction. However, I do not …