Nash blocks

Abstract

AbstractA product set of pure strategies is a Nash block if it contains all best replies to the Nash equilibria of the game in which the players are restricted to the strategies in the block. This defines an intermediate block property, between curb (Basu and Weibull, Econ Lett 36(2):141–146, 10.1016/0165-1765(91)90179-O, http://www.sciencedirect.com/science/article/pii/016517659190179O, 1991) and coarse tenability (Myerson and Weibull (2015) Econometrica 83(3):943–976, 10.3982/ECTA11048). While the new concept is defined without reference to the consideration-set framework that defines tenability, the framework can be used to characterize Nash blocks in terms of potential conventions when large populations of individuals recurrently interact. Although weaker than curb, Nash blocks nevertheless maintain several robustness properties of curb sets. For example, every Nash block contains an essential component and is robust against payoff perturbations.