Characterisation of reactive Nash equilibria in repeated additive games

Abstract

In this paper, we study reactive strategies in repeated additive games between two players with finitely many actions. Reactive strategies condition only on the opponent's previous action, making them one of the simplest ways players can respond to past interactions. Additive games include important models of cooperation, such as the donation game and games with a punishment option. We show that, for this class of games and strategies, the conditions for symmetric Nash equilibria reduce to a system of linear equalities and inequalities in the strategy parameters, allowing us to characterise all such equilibria. We establish a one-to-one correspondence between non-empty subsets S of the action set and equilibrium classes, which we call S-supporting equilibria. These are equilibria that use exactly the actions in S when playing against themselves. As a special case, we recover the well-known equalizer strategies as the equilibria supported on the entire action set. To assess which equilibrium classes are most evolutionarily relevant, we complement our analytical characterisation with simulations of social learning dynamics. We find that their prevalence is determined by two factors: how likely they are to be generated and how robust they are against invasion.