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Dynamic psychological games Author info | Abstract | Publisher info | Download info | Related research | Statistics Battigalli, Pierpaolo
Dufwenberg, Martin
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The motivation of decision makers who care for various emotions, intentions-based reciprocity, or the opinions of others may depend directly on beliefs (about choices, beliefs, or information). Geanakoplos, Pearce and Stacchetti [J. Geanakoplos, D. Pearce, E. Stacchetti, Psychological games and sequential rationality, Games Econ. Behav. 1 (1989) 60-79] point out that traditional game theory is ill-equipped to address such matters, and they pioneer a new framework which does. However, their toolbox - psychological game theory - incorporates several restrictions that rule out plausible forms of belief-dependent motivation. Building on recent work on dynamic interactive epistemology, we propose a more general framework. Updated higher-order beliefs, beliefs of others, and plans of action may influence motivation, and we can capture dynamic psychological effects (such as sequential reciprocity, psychological forward induction, and regret) that were previously ruled out. We develop solution concepts, provide examples, explore properties, and suggest avenues for future research.
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Article provided by Elsevier in its journal Journal of Economic Theory .
Volume (Year): 144 (2009)
Issue (Month): 1 (January)
Pages: 1-35
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Handle: RePEc:eee:jetheo:v:144:y:2009:i:1:p:1-35Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622869
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Keywords: Psychological games Belief-dependent motivation Extensive-form solution concepts Dynamic interactive epistemology ; Other versions of this item:
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references Cited by : (explanations , Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile , click on "citations" and make appropriate adjustments.)
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