Subgame consistency is a fundamental element in the solution of cooperative stochastic differential games. In particular, it ensures that the extension of the solution policy to a later starting time and any possible state brought about by prior optimal behavior of the players will remain optimal. Recently, mechanisms for the derivation of subgame consistent solutions in stochastic cooperative differential games with transferable payoffs have been found. In the case when players’ payoffs are nontransferable, the derivation of solution candidates is extremely complicated and often intractable. In this chapter, subgame consistent solutions are derived for a class of cooperative stochastic differential games with nontransferable payoffs.

Original languageEnglish
Title of host publicationAnnals of the International Society of Dynamic Games
PublisherBirkhäuser Verlag AG
Pages153-170
Number of pages18
DOIs
StatePublished - 1 Jan 2007

Publication series

NameAnnals of the International Society of Dynamic Games
Volume9
ISSN (Print)2474-0179
ISSN (Electronic)2474-0187

    Scopus subject areas

  • Statistics, Probability and Uncertainty
  • Statistics and Probability
  • Applied Mathematics

    Research areas

  • Cooperative stochastic differential games, Nontransferable payoffs, Rationality, Subgame consistent solution

ID: 36952514