Mean Field Equilibrium: Uniqueness, Existence, and Comparative Statics
Mean Field Equilibrium: Uniqueness, Existence, and Comparative Statics
The standard solution concept for stochastic games is Markov perfect equilibrium (MPE); however, its computation becomes intractable as the number of players increases. Instead, we consider mean field equilibrium (MFE) that has been popularized in the recent literature. MFE takes advantage of averaging effects in models with a large number …