Backwards-induction outcome in a quantum game

Details Backwards-induction outcome in a quantum game Backwards-induction outcome in a quantum game

2001-11-19

arxiv.org/abs/quant-ph/0111090v2

Phys. Rev. A 65, 052328 (2002)

Physics

Quantum Physics

Revised in the light of referee's comments. Latex, 16 pages, 2 figures, To appear in Phy. Rev. A

Scientific paper

10.1103/PhysRevA.65.052328

In economics duopoly is a market dominated by two firms large enough to influence the market price. Stackelberg presented a dynamic form of duopoly that is also called `leader-follower' model. We give a quantum perspective on Stackelberg duopoly that gives a backwards-induction outcome same as the Nash equilibrium in static form of duopoly also known as Cournot's duopoly. We find two qubit quantum pure states required for this purpose.

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