Satisficing Equilibrium
<|reference_start|>Satisficing Equilibrium: In a $\textit{satisficing equilibrium}$ each agent plays one of their $k$ best pure actions, but not necessarily their best action. We show that satisficing equilibria in which agents play only their best or second-best action exist in almost all games. In fact, in almost all games, there exist satisficing equilibria in which all but one agent best-respond and the remaining agent plays at least a second-best action. By contrast, more than one third of games possess no pure Nash equilibrium. In addition to providing static foundations for satisficing equilibria, we show that a parsimonious dynamic converges to satisficing equilibria in almost all games. We apply our results to market design and show that a mediator who can control a single agent can enforce stability in most games. Finally, we use our results to study the existence of $\epsilon$-equilibria.<|reference_end|>
@article{pradelski2024satisficing,
    title={Satisficing Equilibrium},
    author={Bary S.R. Pradelski and Bassel Tarbush},
    journal={arXiv preprint arXiv:2409.00832},
    year={2024},
    archivePrefix={arXiv},
    eprint={2409.00832},
    primaryClass={econ.TH cs.GT}
}