The Focal Quantal Response Equilibrium (opens in new tab)

We propose a generalization of Quantal Response Equilibrium (QRE) built on a simple premise: some actions are more focal than others. In our model, which we call the Focal Quantal Response Equilibrium (Focal QRE), each player plays a stochastic version of Nash equilibrium as in the QRE, but some strategies are focal and thus are chosen relatively more frequently than other strategies after accounting for expected utilities. The Focal QRE is ...