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Admissibility and event-rationality

Barelli, Paulo and Galanis, Spyros (2013) Admissibility and event-rationality Games and Economic Behavior, 77, (1), pp. 21-40. (doi:10.1016/j.geb.2012.08.012).

Record type: Article

Abstract

We develop an approach to providing epistemic conditions for admissible behavior in games. Instead of using lexicographic beliefs to capture infinitely less likely conjectures, we postulate that players use tie-breaking sets to help decide among strategies that are outcome-equivalent given their conjectures. A player is event-rational if she best responds to a conjecture and uses a list of subsets of the other players? strategies to break ties among outcome-equivalent strategies. Using type spaces to capture interactive beliefs, we show that event-rationality and common belief of event-rationality (RCBER) imply S?W, the set of admissible strategies that survive iterated elimination of dominated strategies. By strengthening standard belief to validated belief, we show that event-rationality and common validated belief of event-rationality (RCvBER) imply IA, the iterated admissible strategies. We show that in complete, continuous and compact type structures, RCBER and RCvBER are nonempty, hence providing epistemic criteria for S?W and IA.

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More information

e-pub ahead of print date: 11 September 2012
Published date: January 2013
Keywords: epistemic game theory, admissibility, iterated weak dominance, common knowledge, rationality, completeness
Organisations: Economics

Identifiers

Local EPrints ID: 71037
URI: http://eprints.soton.ac.uk/id/eprint/71037
ISSN: 0899-8256
PURE UUID: e4d3a742-ee50-429c-9d66-4e02b942fa67
ORCID for Spyros Galanis: ORCID iD orcid.org/0000-0003-4286-7449

Catalogue record

Date deposited: 14 Dec 2009
Last modified: 19 Jul 2017 00:02

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Contributors

Author: Paulo Barelli
Author: Spyros Galanis ORCID iD

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