A Note on the Evolution of Preferences

This note checks the robustness of a surprising result in Dekel et al. (2007). The result states that strict Nash equilibria might cease to be evolutionary stable when agents are able to observe the opponent’s preferences with a very low probability. This note shows that the result is driven by the assumption that there is no risk for the observed preferences to be mistaken. In particular, when a player may observe a signal correlated with the opponent’s preferences, but the signal is noisy enough, all strict Nash equilibria are evolutionary stable.

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