On subgame perfect equilibria in quantum Stackelberg duopoly with incompete information

TL;DR

This paper explores quantum Stackelberg duopoly with incomplete information, revealing that maximal quantum correlation eliminates first-mover advantage and benefits the second mover in equilibrium payoffs.

Contribution

It extends quantum game theory to Stackelberg duopoly with incomplete information, showing how quantum entanglement affects strategic advantages.

Findings

Maximal quantum correlation removes first-mover advantage.

Second mover achieves higher equilibrium payoff.

Quantum entanglement influences strategic outcomes in duopoly.

Abstract

The Li-Du-Massar quantum duopoly model is one of the generally accepted quantum game schemes. It has applications in a wide range of duopoly problems. Our purpose is to study Stackelberg's duopoly with incomplete information in the quantum domain. The result of Lo and Kiang has shown that the correlation of players' quantities caused by the quantum entanglement enhances the first-mover advantage in the game. Our work demonstrates that there is no first-mover advantage if the players' actions are maximally correlated. Furthermore, we proved that the second mover gains a higher equilibrium payoff that the first one.