Open-loop model
Encyclopedia
In game theory
, an open-loop model is the one where players cannot observe the play of their opponents, as opposed to a closed-loop model, where all past play is common knowledge
. The solution to an open-loop model is called "open-loop equilibrium".
Open loop models are more tractable, which is why they are sometimes preferred to closed-loop models even when the latter is a better description of reality.
Game theory
Game theory is a mathematical method for analyzing calculated circumstances, such as in games, where a person’s success is based upon the choices of others...
, an open-loop model is the one where players cannot observe the play of their opponents, as opposed to a closed-loop model, where all past play is common knowledge
Common knowledge
Common knowledge is knowledge that is known by everyone or nearly everyone, usually with reference to the community in which the term is used. Common knowledge need not concern one specific subject, e.g., science or history. Rather, common knowledge can be about a broad range of subjects, including...
. The solution to an open-loop model is called "open-loop equilibrium".
Open loop models are more tractable, which is why they are sometimes preferred to closed-loop models even when the latter is a better description of reality.