Extremely Values of Uncertain Payoffs in 2 × 2 Simulated-Based Game: A U-quadratic Distribution Case
Published in Computer Science and Applications, 2015
Title
Extremely Values of Uncertain Payoffs in 2 × 2 Simulated-Based Game: A U-quadratic Distribution Case
Author
- Yao-Hsien Lee, Departmetn of Finance, Chung Hua University, Hsinchu, 20012, Taiean
- Mei-Yu Lee, Department of Healthcare Management, Yuanpei University, 306, Yuanpei Str., Hsinchu 30015, Taiwan
Abstract
This paper examines that the strategic payoffs with U-quadratic distribution, which represents the extreme values with high probability, affect the distribution of the equilibrium. In fact, the range parameters play the most important role in the game model with the extreme values of strategic payoffs. The authors discover that the intersection between the ranges of strategic payoffs and the decision rule decide the distributed shape of the equilibrium payoffs. The intersection between the ranges of strategic payoffs leads to three results as follows: (1) The equilibrium payoffs at the range between the low bound of strategic payoff and the high bound of dominantly strategic payoff; (2) The risk premium exists and is higher in the small mean case; (3) The mean effect of strategic payoffs decreases the risk premium.
Keywords
- Nash equilibrium
- distributed payoff
- simulation-based game
- stochastic game
- random game
- computer simulation
Recommended citation: Yao-Hsien Lee and Mei-Yu Lee*, 2015, Extremely Values of Uncertain Payoffs in 2 × 2 Simulated-Based Game: A U-quadratic Distribution Case, Computer Science and Applications, 2(5), 182-199. https://www.researchgate.net/profile/Mei-Yu-Lee/publication/282765959_Extremely_Values_of_Uncertain_Payoffs_in_2_2_Simulated-Based_Game_A_U-quadratic_Distribution_Case_Computer_Science_and_Applications/links/6231d2974ce552783cc02f72/Extremely-Values-of-Uncertain-Payoffs-in-2-2-Simulated-Based-Game-A-U-quadratic-Distribution-Case-Computer-Science-and-Applications.pdf