Trigger strategy

Trigger strategy

A trigger strategy is a class of strategies employed in a repeated non-cooperative game. A player utilizing a trigger strategy initially cooperates but punishes the opponent if a certain level of defection (i.e., the trigger) is observed. The level of punishment and the sensitivity of the trigger vary with different trigger strategies.

Trigger strategies

*Tit for Tat (the punishment continues as long as the other player defects)
* Tit for Two Tats (a more forgiving variant of tit for tat)
*Grim trigger (the punishment continues indefinitely after the other player defects just once)

;Textbooks and general reference texts

* Vives, X. (1999) "Oligopoly pricing", MIT Press, Cambridge MA (readable; suitable for advanced undergraduates.)
* Tirole, J. (1988) "The Theory of Industrial Organization", MIT Press, Cambridge MA (An organized introduction to industrial organization)

;Classical paper on this subject

* Friedman, J. (1971). A non-cooperative equilibrium for supergames, Review of Economic Studies 38, 1-12. (The first formal proof of the Folk theorem (game theory)).

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