Payoff Information and SelfConfirming Equilibrium
In a selfconfirming equilibrium, each player correctly forecasts the actions that opponents will take along the equilibrium path, but may be mistaken about the way that opponents would respond to deviations. Intuitively, this equilibrium concept models the possible steady states of a learning process in which, each time the game is played, players observe only the actions played by their opponents (as opposed to the complete specification of the opponents' strategies) so that they need never receive evidence that their forecasts of offpath play are incorrect. 3 Because self confirming equilibrium (henceforth "SCE") allows beliefs about offpath play to be completely arbitrary, it (like Nash equilibrium) corresponds to a situation in which players have no prior information about the payoff fimctions of their opponents.4 This may be a good approximation of some realworld situations; it is also the obvious way to model play in game theory experiments in which subjects are given no itiormation about opponents' payoffs. In other cases, both in the real world and in the laboratory, it seems plausible that players do have some prior information about their opponents' payoffs. The goal of this paper is to develop a more restrictive version of SCE that incorporates the effects of such prior information. In carrying out this program, a key issue is what sort of prior itiormation about payoffs should be considered. It is well known that predictions based on common certainty of payoffs are not robust to even a small amount of uncertainty. Following Fudenberg, Kreps and Levine (1987), we are interested in the strongest possible assumption that is robust to payoff uncertainty. Past work suggests that this assumption should be that payoffs are almost common certainty in the sense of Monderer and Samet (1989).5 Therefore we start by developing a preliminary concept  rationalizability at reachable nodes  that is robust and incorporates almost common certainty of th
(This abstract was borrowed from another version of this item.)
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Length:  
Date of creation:  
Date of revision:  
Handle:  RePEc:els:esrcls:040 
Contact details of provider:  Web page: http://else.econ.ucl.ac.uk/ Email: More information through EDIRC

References listed on IDEAS
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.:
 Levine, David & Kreps, David & Fudenberg, Drew, 1988.
"On the Robustness of Equilibrium Refinements,"
Scholarly Articles
3350444, Harvard University Department of Economics.
 Fudenberg, Drew & Kreps, David M. & Levine, David K., 1988. "On the robustness of equilibrium refinements," Journal of Economic Theory, Elsevier, vol. 44(2), pages 354380, April.
 Drew Fudenberg & David Kreps & David K. Levine, 1988. "On the Robustness of Equilibrium Refinements," Levine's Working Paper Archive 227, David K. Levine.
 Drew Fudenberg & David M. Kreps & David K. Levine, 1986. "On the Robustness of Equilibrium Refinements," UCLA Economics Working Papers 398, UCLA Department of Economics.
 BenPorath, Elchanan, 1997.
"Rationality, Nash Equilibrium and Backwards Induction in PerfectInformation Games,"
Review of Economic Studies,
Wiley Blackwell, vol. 64(1), pages 2346, January.
 BenPorath, E., 1992. "Rationality, Nash Equilibrium and Backward Induction in Perfect Information Games," Papers 1492, Tel Aviv  the Sackler Institute of Economic Studies.
 Blume, Lawrence E & Zame, William R, 1994.
"The Algebraic Geometry of Perfect and Sequential Equilibrium,"
Econometrica,
Econometric Society, vol. 62(4), pages 78394, July.
 Lawrence E. Blume & William R. Zame, 1993. "The Algebraic Geometry of Perfect and Sequential Equilibrium," Game Theory and Information 9309001, EconWPA.
 Kaushik Basu, 2010.
"Strategic Irrationality in Extensive Games,"
Levine's Working Paper Archive
375, David K. Levine.
 Basu, Kaushik, 1988. "Strategic irrationality in extensive games," Mathematical Social Sciences, Elsevier, vol. 15(3), pages 247260, June.
 Fudenberg, D. & Levine, D.K., 1991.
"SelfConfirming Equilibrium ,"
Working papers
581, Massachusetts Institute of Technology (MIT), Department of Economics.
 Fudenberg, Drew & Levine, David K, 1993. "SelfConfirming Equilibrium," Econometrica, Econometric Society, vol. 61(3), pages 52345, May.
 Drew Fudenberg & David K. Levine, 1993. "SelfConfirming Equilibrium," Levine's Working Paper Archive 2147, David K. Levine.
 CostaGomes, Miguel & Crawford, Vincent P & Broseta, Bruno, 2001.
"Cognition and Behavior in NormalForm Games: An Experimental Study,"
Econometrica,
Econometric Society, vol. 69(5), pages 11931235, September.
 CostaGomes, Miguel & Crawford, Vincent P. & Broseta, Bruno, 1998. "Cognition and Behavior in NormalForm Games: An Experimental Study," University of California at San Diego, Economics Working Paper Series qt1vn4h7x5, Department of Economics, UC San Diego.
 Miguel CostaGomes & Vincent P. Crawford & Bruno Broseta, . "Cognition and Behavior in NormalForm Games:An Experimental Study," Discussion Papers 00/45, Department of Economics, University of York.
 Broseta, Bruno & CostaGomes, Miguel & Crawford, Vincent P., 2000. "Cognition and Behavior in NormalForm Games: An Experimental Study," University of California at San Diego, Economics Working Paper Series qt0fp8278k, Department of Economics, UC San Diego.
 Ariel Rubinstein & Asher Wolinsky, 1991.
"Rationalizable Conjectural Equilibrium: Between Nash and Rationalizability,"
Discussion Papers
933, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
 Rubinstein Ariel & Wolinsky Asher, 1994. "Rationalizable Conjectural Equilibrium: Between Nash and Rationalizability," Games and Economic Behavior, Elsevier, vol. 6(2), pages 299311, March.
 A. Rubinstein & A. Wolinsky, 2010. "Rationalizable Conjectural Equilibrium: Between Nash and Rationalizability," Levine's Working Paper Archive 369, David K. Levine.
 Fudenberg, Drew & Levine, David K, 1993.
"Steady State Learning and Nash Equilibrium,"
Econometrica,
Econometric Society, vol. 61(3), pages 54773, May.
 Drew Fudenberg & David K. Levine, 1993. "Steady State Learning and Nash Equilibrium," Levine's Working Paper Archive 373, David K. Levine.
 Gul, Faruk, 1996. "Rationality and Coherent Theories of Strategic Behavior," Journal of Economic Theory, Elsevier, vol. 70(1), pages 131, July.
 Pearce, David G, 1984. "Rationalizable Strategic Behavior and the Problem of Perfection," Econometrica, Econometric Society, vol. 52(4), pages 102950, July.
 P. Reny, 2010.
"Common Belief and the Theory of Games with Perfect Information,"
Levine's Working Paper Archive
386, David K. Levine.
 Reny Philip J., 1993. "Common Belief and the Theory of Games with Perfect Information," Journal of Economic Theory, Elsevier, vol. 59(2), pages 257274, April.
 Monderer, Dov & Samet, Dov, 1989. "Approximating common knowledge with common beliefs," Games and Economic Behavior, Elsevier, vol. 1(2), pages 170190, June.
 Tan, Tommy ChinChiu & da Costa Werlang, Sergio Ribeiro, 1988.
"The Bayesian foundations of solution concepts of games,"
Journal of Economic Theory,
Elsevier, vol. 45(2), pages 370391, August.
 Werlang, Sérgio Ribeiro da Costa & ChinChiu Tan, Tommy, 1987. "The Bayesian Foundations of Solution Concepts of Games," Economics Working Papers (Ensaios Economicos da EPGE) 111, FGV/EPGE Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil).
 Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, June.
 Bernheim, B Douglas, 1984.
"Rationalizable Strategic Behavior,"
Econometrica,
Econometric Society, vol. 52(4), pages 100728, July.
 D. B. Bernheim, 2010. "Rationalizable Strategic Behavior," Levine's Working Paper Archive 661465000000000381, David K. Levine.
 D. B. Bernheim, 2010. "Rationalizable Strategic Behavior," Levine's Working Paper Archive 514, David K. Levine.
 D. Pearce, 2010. "Rationalizable Strategic Behavior and the Problem of Perfection," Levine's Working Paper Archive 523, David K. Levine.
 David M Kreps & Robert Wilson, 2003.
"Sequential Equilibria,"
Levine's Working Paper Archive
618897000000000813, David K. Levine.
 Kreps, David M & Wilson, Robert, 1982. "Sequential Equilibria," Econometrica, Econometric Society, vol. 50(4), pages 86394, July.
 David Kreps & Robert Wilson, 1998. "Sequential Equilibria," Levine's Working Paper Archive 237, David K. Levine.
 T. Börgers, 2010.
"Weak Dominance and Approximate Common Knowledge,"
Levine's Working Paper Archive
378, David K. Levine.
 Borgers Tilman, 1994. "Weak Dominance and Approximate Common Knowledge," Journal of Economic Theory, Elsevier, vol. 64(1), pages 265276, October.
 Philip J. Reny, 1992. "Rationality in ExtensiveForm Games," Journal of Economic Perspectives, American Economic Association, vol. 6(4), pages 103118, Fall.
 Battigalli, Pierpaolo, 2003. "Rationalizability in infinite, dynamic games with incomplete information," Research in Economics, Elsevier, vol. 57(1), pages 138, March.
 D. Fudenberg & D. M. Kreps, 2010. "Learning in Extensive Games, I: SelfConfirming Equilibrium," Levine's Working Paper Archive 382, David K. Levine.
 Drew Fudenberg & Eddie Dekel, 1987.
"Rational Behavior with Payoff Uncertainty,"
Working papers
471, Massachusetts Institute of Technology (MIT), Department of Economics.
 Dekel, Eddie & Fudenberg, Drew, 1990. "Rational behavior with payoff uncertainty," Journal of Economic Theory, Elsevier, vol. 52(2), pages 243267, December.
 E. Dekel & D. Fudenberg, 2010. "Rational Behavior with Payoff Uncertainty," Levine's Working Paper Archive 379, David K. Levine.
This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.
When requesting a correction, please mention this item's handle: RePEc:els:esrcls:040. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (s. malkani)
The email address of this maintainer does not seem to be valid anymore. Please ask s. malkani to update the entry or send us the correct addressIf you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.