The probability of nontrivial common knowledge
We study the probability that two or more agents can attain common knowledge of nontrivial events when the size of the state space grows large. We adopt the standard epistemic model where the knowledge of an agent is represented by a partition of the state space. Each agent is endowed with a partition generated by a random scheme. Assuming that agents' partitions are independently and identically distributed, we prove that the asymptotic probability of nontrivial common knowledge undergoes a phase transition. Regardless of the number of agents, when their cognitive capacity is sufficiently large, the probability goes to one; and when it is small, it goes to zero.
|Date of creation:||Jul 2011|
|Date of revision:||Mar 2012|
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- Rinott, Yosef & Scarsini, Marco, 2000.
"On the Number of Pure Strategy Nash Equilibria in Random Games,"
Games and Economic Behavior,
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- Ziv Hellman & Dov Samet, 2010. "How Common Are Common Priors?," Discussion Paper Series dp532, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.
- Marco LiCalzi & Oktay Surucu, 2012. "The Power of Diversity over Large Solution Spaces," Management Science, INFORMS, vol. 58(7), pages 1408-1421, July.
- Marco LiCalzi & Oktay Surucu, 2011. "The power of diversity over large solution spaces," Working Papers 1, Department of Management, Università Ca' Foscari Venezia, revised Sep 2011.
- Marco LiCalzi & Oktay Surucu, 2011. "The power of diversity over large solution spaces," Working Papers 206, Department of Applied Mathematics, Università Ca' Foscari Venezia, revised Sep 2011.
- Dimitri, Nicola, 1993. "Learning partitions," Economics Letters, Elsevier, vol. 42(2-3), pages 195-199.
- Geanakoplos, John, 1994. "Common knowledge," Handbook of Game Theory with Economic Applications,in: R.J. Aumann & S. Hart (ed.), Handbook of Game Theory with Economic Applications, edition 1, volume 2, chapter 40, pages 1437-1496 Elsevier.
- John Geanakoplos, 1992. "Common Knowledge," Journal of Economic Perspectives, American Economic Association, vol. 6(4), pages 53-82, Fall. Full references (including those not matched with items on IDEAS)
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