William E. Walsh, Rajarshi Das, Gerald Tesauro, and Jeffrey O. Kephart
We develop a model for analyzing complex games with repeated interactions, for which a full game-theoretic analysis is intractable. Our approach treats exogenously specified, heuristic strategies, rather than the atomic actions, as primitive, and computes a heuristic-payoff table specifying the expected payoffs of the joint heuristic strategy space. We analyze two games based on (i) automated dynamic pricing and (ii) continuous double auction. For each game we compute Nash equilibria of previously published heuristic strategies. To determine the most plausible equilibria, we study the replicator dynamics of a large population playing the strategies. In order to account for errors in estimation of payoffs or improvements in strategies, we also analyze the dynamics and equilibria based on perturbed payoffs.