An impossibility theorem in game dynamics.

The Nash equilibrium—a, combination of choices by the players of a game from which no self-interested player would deviate—is the predominant solution concept in game theory. Even though every game has a Nash equilibrium, it is not known whether there are deterministic behaviors of the players who play a game repeatedly that are guaranteed to converge to a Nash equilibrium of the game from all starting points. If one assumes that the players’ behavior is a discrete-time or continuous-time rule whereby the current mixed strategy profile is mapped to the next, this question becomes a problem in the theory of dynamical systems. We apply this theory, and in particular Conley index theory, to prove a general impossibility result: There exist games, for which all game dynamics fail to converge to Nash equilibria from all starting points. The games which help prove this impossibility result are degenerate, but we conjecture that the same result holds, under computational complexity assumptions, for nondegenerate games. We also prove a stronger impossibility result for the solution concept of approximate Nash equilibria: For a set of games of positive measure, no game dynamics can converge to the set of approximate Nash equilibria for a sufficiently small yet substantial approximation bound. Our results establish that, although the notions of Nash equilibrium and its computation-inspired approximations are universally applicable in all games, they are fundamentally incomplete as predictors of long-term player behavior. [ABSTRACT FROM AUTHOR]