AbstractWe study the strategic advantages of following rules of thumb that bundle different games together (called rule rationality) when this may be observed by one's opponent. We present a model in which the strategic environment determines which kind of rule rationality is adopted by the players. We apply the model to characterize the induced rules and outcomes in various interesting environments. Finally, we show the close relations between act rationality and “Stackelberg stability” (no player can earn from playing first).
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 48746.
Date of creation: 31 Jul 2013
Date of revision:
Bounded Rationality; Commitments; Categorization; Value of information.;
Find related papers by JEL classification:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-08-05 (All new papers)
- NEP-CBE-2013-08-05 (Cognitive & Behavioural Economics)
- NEP-CDM-2013-08-05 (Collective Decision-Making)
- NEP-CTA-2013-08-05 (Contract Theory & Applications)
- NEP-GTH-2013-08-05 (Game Theory)
- NEP-HPE-2013-08-05 (History & Philosophy of Economics)
- NEP-MIC-2013-08-05 (Microeconomics)
- NEP-ORE-2013-08-05 (Operations Research)
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