Risk dominance and payoff dominance are two related refinements of the Nash equilibrium (NE) solution concept in game theory, defined by John Harsanyi and Reinhard Selten. A Nash equilibrium is considered payoff dominant if it is Pareto superior to all other Nash equilibria in the game.1 When faced with a choice among equilibria, all players would agree on the payoff dominant equilibrium since it offers to each player at least as much payoff as the other Nash equilibria. Conversely, a Nash equilibrium is considered risk dominant if it has the largest basin of attraction (i.e. is less risky). This implies that the more uncertainty players have about the actions of the other player(s), the more likely they will choose the strategy corresponding to it.
The payoff matrix in Figure 1 provides a simple two-player, two-strategy example of a game with two pure Nash equilibria. The strategy pair (Hunt, Hunt) is payoff dominant since payoffs are higher for both players compared to the other pure NE, (Gather, Gather). On the other hand, (Gather, Gather) risk dominates (Hunt, Hunt) since if uncertainty exists about the other player's action, gathering will provide a higher expected payoff. The game in Figure 1 is a well-known game-theoretic dilemma called stag hunt. The rationale behind it is that communal action (hunting) yields a higher return if all players combine their skills, but if it is unknown whether the other player helps in hunting, gathering might turn out to be the better individual strategy for food provision, since it does not depend on coordinating with the other player. In addition, gathering alone is preferred to gathering in competition with others. Like the Prisoner's dilemma, it provides a reason why collective action might fail in the absence of credible commitments.
Riskdominance and payoff dominance are two related refinements of the Nash equilibrium (NE) solution concept in game theory, defined by John Harsanyi...
In game theory, strategic dominance (commonly called simply dominance) occurs when one strategy is better than another strategy for one player, no matter...
Dominance and submission (D/s) is a set of behaviors, customs, and rituals involving the submission of one person to another in an erotic episode or lifestyle...
required for determining dominance. Risk aversion is a factor only in second order stochastic dominance. Stochastic dominance does not give a total order...
In the zoological field of ethology, a dominance hierarchy (formerly and colloquially called a pecking order) is a type of social hierarchy that arises...
the riskdominance condition places a bound on the mixed strategy Nash equilibrium. No payoffs (that satisfy the above conditions including risk dominance)...
In economics and finance, risk aversion is the tendency of people to prefer outcomes with low uncertainty to those outcomes with high uncertainty, even...
case where door 1 conceals the car and Monty chooses to open door 3. Dominance is a strong reason to seek for a solution among always-switching strategies...
CONPLAN 8888, also known as Counter-Zombie Dominance, is a U.S. Department of Defense Strategic Command CONOP document that describes a plan for the United...
using two major strategies known as dominance and prestige. The first and oldest of the two strategies, dominance, is exemplified by the use of force...
coordination failure, most cases are that subjects achieve riskdominance rather than payoff dominance. Even when payoffs are better when players coordinate...
2000-08-29 Julia L. Wirch; Mary R. Hardy. "Distortion Risk Measures: Coherence and Stochastic Dominance" (PDF). Archived from the original (PDF) on July 5...
Estrogen dominance (ED) is a theory about a metabolic state where the level of estrogen outweighs the level of progesterone in the body. This is said...
shortfall (ES) is a risk measure—a concept used in the field of financial risk measurement to evaluate the market risk or credit risk of a portfolio. The...
safe sex advantage of minimizing the transmission risk for HIV/AIDS; however, it still carries the risk of skin-to-skin sexually transmitted infections...
S2CID 53327887. Julia L. Wirch; Mary R. Hardy. "Distortion Risk Measures: Coherence and Stochastic Dominance" (PDF). Archived from the original (PDF) on July 5...
voltage, there is also risk of interference with normal heart function (potentially including cardiac arrest), and this risk is higher for those who...
and Gender", 2007. p. 179. Varrin, Cynthia. "The Art of Sensual Female Dominance: A Guide for Women", 2000. p. 28. Morey, Craig. "The Seductive Art of...
marginal conditional stochastic dominance is a condition under which a portfolio can be improved in the eyes of all risk-averse investors by incrementally...
as a "with psychopathic traits" specifier modelled after the Fearless Dominance scale of the Psychopathic Personality Inventory, defined by low Anxiousness...