Strategic Interaction under Bounded Capacity: Quantal Response, Potential, and the Recovery of Nash Equilibrium

Standard game theory assumes players optimise perfectly. This paper rebuilds it on a player of finite information capacity, whose best response softly favours better actions. That response is the familiar logit rule, so equilibrium becomes the logit quantal response equilibrium, and Nash equilibrium reappears in the unlimited-capacity limit; potential games add a principled equilibrium selection valid only within that class. The gain is a discipline for network games. When the interaction network is inferred from how players co-move rather than assumed, only its leading eigenvalue and, for complements, its centrality ranking are firmly pinned. The leading direction can be targeted; the individual link and the key player cannot, and are refused. The results are theoretical, shown by a closed-form pair of networks that look identical yet reverse every link.