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Iterated strict dominance in general games

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  • Chen, Yi-Chun
  • Long, Ngo Van
  • Luo, Xiao

Abstract

We offer a definition of iterated elimination of strictly dominated strategies (IESDS) for games with (in)finite players, (non)compact strategy sets, and (dis)continuous payoff functions. IESDS is always a well-defined order independent procedure that can be used to solve Nash equilibrium in dominance-solvable games. We characterize IESDS by means of a "stability"" criterion, and offer a sufficient and necessary epistemic condition for IESDS. We show by an example that IESDS may generate spurious Nash equilibria in the class of Reny's better-reply secure games. We provide sufficient/necessary conditions under which IESDS preserves the set of Nash equilibria." Nous donnons une définition de l'élimination itérative des stratégies qui sont strictement donimées (EISSD) pour les jeux avec un nombre fini (ou infini) de joueurs , des ensembles de stratégies compactes (ou non-compactes), et des fonctions de gains continues (ou non-continues). Le processus EISSD est bien défini et indépendant de l'ordre d'élimination. Nous donnons une caractérisation du processus EISSD en utilisant un critère de stabilité et offrons une condition épistémologique. Nous démontrons que le processus EISSD peut produire des équilibres faux dans la classe des jeux de meilleures réponses sécuritaires de Reny. Nous donnons des conditions nécessaires et suffisantes pour que le processus EISSD conserve l'ensemble des équilibre de Nash.
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  • Chen, Yi-Chun & Long, Ngo Van & Luo, Xiao, 2007. "Iterated strict dominance in general games," Games and Economic Behavior, Elsevier, vol. 61(2), pages 299-315, November.
  • Handle: RePEc:eee:gamebe:v:61:y:2007:i:2:p:299-315
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    Cited by:

    1. Herings, P.J.J. & Predtetchinski, A., 2015. "Best response cycles in perfect information games," Research Memorandum 017, Maastricht University, Graduate School of Business and Economics (GSBE).
    2. Kunimoto, Takashi & Serrano, Roberto, 2011. "A new necessary condition for implementation in iteratively undominated strategies," Journal of Economic Theory, Elsevier, vol. 146(6), pages 2583-2595.
    3. Robin P. Cubitt & Robert Sugden, 2008. "Common reasoning in games," Discussion Papers 2008-01, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    4. Yi-Chun Chen & Xiao Luo & Chen Qu, 2016. "Rationalizability in general situations," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 61(1), pages 147-167, January.
    5. Cubitt, Robin P. & Sugden, Robert, 2011. "The reasoning-based expected utility procedure," Games and Economic Behavior, Elsevier, vol. 71(2), pages 328-338, March.
    6. Yi-Chun Chen & Xiao Luo, 2012. "An indistinguishability result on rationalizability under general preferences," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 51(1), pages 1-12, September.
    7. Michael Trost, 2014. "On the Equivalence between Iterated Application of Choice Rules and Common Belief of Applying these Rules," Jena Economic Research Papers 2014-032, Friedrich-Schiller-University Jena.
    8. Luo, Xiao & Yang, Chih-Chun, 2009. "Bayesian coalitional rationalizability," Journal of Economic Theory, Elsevier, vol. 144(1), pages 248-263, January.
    9. Robin Cubitt & Robert Sugden, 2005. "Common reasoning in games: a resolution of the paradoxes of ‘common knowledge of rationality’," Discussion Papers 2005-17, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    10. Michael Trost, 2012. "An Epistemic Rationale for Order-Independence," Jena Economic Research Papers 2012-010, Friedrich-Schiller-University Jena.
    11. Luo, Xiao, 2009. "The foundation of stability in extensive games with perfect information," Journal of Mathematical Economics, Elsevier, vol. 45(12), pages 860-868, December.
    12. Pedro Jara-Moroni, 2008. "Rationalizability in games with a continuum of players," Working Papers halshs-00587863, HAL.
    13. repec:eee:mateco:v:72:y:2017:i:c:p:82-87 is not listed on IDEAS
    14. Kokkala, Juho & Poropudas, Jirka & Virtanen, Kai, 2015. "Rationalizable Strategies in Games With Incomplete Preferences," MPRA Paper 68331, University Library of Munich, Germany.
    15. Jara-Moroni, Pedro, 2012. "Rationalizability in games with a continuum of players," Games and Economic Behavior, Elsevier, vol. 75(2), pages 668-684.
    16. Dekel, Eddie & Siniscalchi, Marciano, 2015. "Epistemic Game Theory," Handbook of Game Theory with Economic Applications, Elsevier.

    More about this item

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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