8-raffinements-e - F Koessler Equilibrium Renement and...

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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games Dynamic Games of Incomplete Information Equilibrium Refinement and Signaling Games Outline (November 20, 2007)
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games Dynamic Games of Incomplete Information Equilibrium Refinement and Signaling Games Outline (November 20, 2007) Introductory Examples
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games Dynamic Games of Incomplete Information Equilibrium Refinement and Signaling Games Outline (November 20, 2007) Introductory Examples Sequential Rationality and Perfect Bayesian Equilibrium
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games Dynamic Games of Incomplete Information Equilibrium Refinement and Signaling Games Outline (November 20, 2007) Introductory Examples Sequential Rationality and Perfect Bayesian Equilibrium Strong Belief Consistency and Sequential Equilibrium
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games Dynamic Games of Incomplete Information Equilibrium Refinement and Signaling Games Outline (November 20, 2007) Introductory Examples Sequential Rationality and Perfect Bayesian Equilibrium Strong Belief Consistency and Sequential Equilibrium Signaling Games
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games Dynamic Games of Incomplete Information Equilibrium Refinement and Signaling Games Outline (November 20, 2007) Introductory Examples Sequential Rationality and Perfect Bayesian Equilibrium Strong Belief Consistency and Sequential Equilibrium Signaling Games Application: Spence’s (1973) Model of Education
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games In games with imperfect information, subgame perfection is not always strong enough to eliminate “irrational decisions” or “incredible threats” off the equilibrium path
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games In games with imperfect information, subgame perfection is not always strong enough to eliminate “irrational decisions” or “incredible threats” off the equilibrium path Example. c (1 , 4) a b 1 D (0 , 0) G (3 , 2) D (0 , 0) G (2 , 3) 2
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games In games with imperfect information, subgame perfection is not always strong enough to eliminate “irrational decisions” or “incredible threats” off the equilibrium path Example. c (1 , 4) a b 1 D (0 , 0) G (3 , 2) D (0 , 0) G (2 , 3) 2 ( c, D ) is a (SP)NE but D is not an optimal decision at player 2’s information set
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F. Koessler / November 20, 2007 Equilibrium Refinement and Signaling Games In games with imperfect information, subgame perfection is not always strong enough to eliminate “irrational decisions” or “incredible threats” off the equilibrium path Example.
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