Epistemically robust strategy subsets

Geir B. Asheim, Mark Voorneveld and Jörgen W. Weibull

Photo: MDPI

Published in:

Games, volume 7, issue 4, 2016

 

DOI:10.3390/g7040037

 

Abstract:

We define a concept of epistemic robustness in the context of an epistemic model of a finite normal-form game where a player type corresponds to a belief over the profiles of opponent strategies and types. A Cartesian product X of pure-strategy subsets is epistemically robust if there is a Cartesian product Y of player type subsets with X as the associated set of best reply profiles such that the set Y i Yi contains all player types that believe with sufficient probability that the others are of types in Y −i Y−i and play best replies. This robustness concept provides epistemic foundations for set-valued generalizations of strict Nash equilibrium, applicable also to games without strict Nash equilibria. We relate our concept to closedness under rational behavior and thus to strategic stability and to the best reply property and thus to rationalizability.

 

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Published Feb. 2, 2017 10:19 AM - Last modified Feb. 2, 2017 10:19 AM