Equilibrium Selection in the Two-Population KMR Model

This paper shows that, for the class of individualistic adjustment dynamics, unique equilibrium selection is possible in the two-population model of evolution by Kandori, Mailath and Rob (1993). We establish that, for generic 2×2 co-ordination games, the evolutionary process always selects the mutation-dominant equilibrium. Though the concepts of mutation dominance and risk dominance yield different equilibrium predictions, we show that mutation dominance represents a natural extension of risk dominance that additionally captures the risk arising from the evolutionary environment.