The Evolutionary Stability of Perfectly Competitive Behavior

Carlos Alós-Ferrer, University of Konstanz
Ana B. Ania, University of Vienna

Abstract

(Also known as <strong>The Evolutionary Logic of Feeling Small</strong>) In a (generalized) symmetric aggregative game, payoffs depend only on individual strategy and an aggregate of all strategies. Players behaving as if they were negligible would optimize taking the aggregate as given. We provide evolutionary and dynamic foundations for such behavior when the game satisfies supermodularity conditions. The results obtained are also useful to characterize evolutionarily stable strategies in a finite population.