Open-loop model
Appearance
In game theory, an open-loop model is the one where players cannot observe the play of their opponents, as opposed to a closed-loop model, where all past play is common knowledge. The solution an open-loop model is called "open-loop equilibrium".
Open loop models are more tractable, which is why they are sometimes preferred to closed-loop models even when the latter is a better description of reality.
References
- Fudenberg, Drew and Levine, David K.: Open-Loop and Closed-Loop Equilibria in Dynamic Games with Many players, Journal of Economic Theory 44, 1988.
This article has not been added to any content categories. Please help out by adding categories to it so that it can be listed with similar articles, in addition to a stub category. (September 2010) |