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Abstract In this paper, we examine strategic settings in which players have interdependent preferences. Players' utility functions depend not only on the strategy profile being played, but also on the realized utilities of other players. Thus, players' realized utilities are interdependent, capturing the psychological phenomena of affective empathy and emotional contagion. We offer a solution concept for these empathetic games and show that the set of equilibria is non-empty and, generically, finite. Motivated by psychological evidence, we then analyze sympathetic and antipathetic games. In the former, players' utilities increase in others' realized utilities, capturing unconditional friendship; in the latter, the opposite holds, resembling hostility.
Economics
Economics
citations This is an alternative to the "Influence" indicator, which also reflects the overall/total impact of an article in the research community at large, based on the underlying citation network (diachronically). | 5 | |
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