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The traditional mechanism of finding Nash equilibria presumes economic actors are capable of performing computations that even computers would take far too long to complete. A decentralized and parallel process of interactions between simple economic actors is presented as a more plausible microfoundation of the concept of Nash equilibria. It is found that agent interactions on a scale-free network converge to an equilibrium within reasonable time. NP computational complexity of Nash equilibria does not diminish its empirical relevance.
Journal | Data powered by TypesetEastern Economic Journal |
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Publisher | Data powered by TypesetSpringer Science and Business Media LLC |
Open Access | No |