Markov perfect equilibrium

A Markov perfect equilibrium is an equilibrium concept in game theory. It is the refinement of the concept of subgame perfect equilibrium to extensive form games for which a pay-off relevant state space can be readily identified. The term appeared in publications starting about 1988 in the work of economists Jean Tirole and Eric Maskin. It has since been used, among else, in the analysis of industrial organization, macroeconomics and political economy.