REPEATED GAMES WITH M-PERIOD BOUNDED MEMORY (PURE STRATEGIES)

This paper provides a characterization for the set of outcomes which c an be sustained by subgame perfect equilibrium strategies in repeated games with M-period bounded memory, pure strategies, no discounting an d finite number of action profiles. The characterization indicates tha t the equilibrium set expands very fast (in an 'exponential' fashion) as the memory increases and slowly (in a 'polynomial' fashion) as the set of action profiles available to the players at each stage expands. (C) 1998 Elsevier Science S.A. All rights reserved.