Weakly dominated strategy

Definition

A weakly dominated strategy is one that results in an outcome that is at least as good as another strategy for a player, regardless of what the opponents choose, but it is not strictly better in every situation. This concept connects to the broader idea of strategic choices in games, where players evaluate their options based on potential payoffs, making decisions that maximize their benefits while considering their rivals' actions.

5 Must Know Facts For Your Next Test

1. In a game with multiple strategies, if one strategy weakly dominates another, rational players will not choose the weakly dominated strategy when they have a better option available.
2. Weakly dominated strategies can be removed from consideration when analyzing strategic interactions, simplifying decision-making processes.
3. The existence of weakly dominated strategies does not guarantee that players will not select them, as they may still provide satisfactory outcomes in certain contexts.
4. Weakly dominated strategies differ from strictly dominated strategies, which are always worse than another option and thus can be eliminated without any conditions.
5. Identifying weakly dominated strategies can help players focus on more promising strategies, enhancing their chances of achieving favorable results.

Review Questions

• How does the concept of weakly dominated strategies influence players' decision-making processes in games?
  • Weakly dominated strategies influence players' decision-making by encouraging them to focus on strategies that offer equal or superior payoffs compared to other options. Players are more likely to discard weakly dominated strategies because they have at least one better alternative. This evaluation allows players to streamline their choices and concentrate on potentially more advantageous moves, improving their overall performance in strategic scenarios.
• Discuss the relationship between weakly dominated strategies and Nash equilibrium in game theory.
  • The relationship between weakly dominated strategies and Nash equilibrium lies in how they affect stability within strategic interactions. A Nash equilibrium occurs when players select strategies that are best responses to each other's choices. If any player's strategy is weakly dominated, they could potentially improve their outcome by switching to a better option. This means that identifying and eliminating weakly dominated strategies can lead players towards more stable outcomes where Nash equilibrium conditions are met.
• Evaluate the implications of weakly dominated strategies for predicting outcomes in competitive environments.
  • Evaluating weakly dominated strategies provides crucial insights into predicting outcomes in competitive environments by highlighting which strategies may be overlooked or misused by players. Since these strategies may still yield acceptable results but are not optimal, players might inadvertently stick with them due to their perceived safety or familiarity. Understanding this dynamic allows analysts to predict shifts in player behavior, particularly when exploring how rational decision-making unfolds in competitive situations and how it may lead to suboptimal equilibrium states.

Related terms

dominant strategy:

A dominant strategy is one that always provides a higher payoff than any other strategy available to a player, no matter what the other players do.

Nash equilibrium:

A Nash equilibrium is a situation in a game where no player can benefit by changing their strategy while the others keep theirs unchanged.

best response: A best response is the strategy that yields the highest payoff for a player, given the strategies chosen by the other players.