Hierarchies of Conditional Beliefs and Interactive Epistemology in Dynamic Games

Pierpaolo Battigalli, Marciano Siniscalchi

Research output: Contribution to journalArticle

91 Scopus citations

Abstract

The epistemic analysis of solution concepts for dynamic games involves statements about the players' beliefs conditional upon different histories of play, their conditional beliefs about each other's conditional beliefs, etc. To represent such statements, we construct a space of infinite (coherent) hierarchies of conditional probability systems, defined with respect to a fixed collection of relevant hypotheses concerning an external state (e.g., the strategy profile being played.) As an application, we derive results about common certainty of the opponent's rationality conditonal on an arbitrary collection of histories in multistage games with observed actions and (possibly) incomplete information. Journal of Economic Literature Classification Numbers: C72, D82.

Original languageEnglish (US)
Pages (from-to)188-230
Number of pages43
JournalJournal of Economic Theory
Volume88
Issue number1
DOIs
StatePublished - Sep 1 1999

ASJC Scopus subject areas

  • Economics and Econometrics

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