Rationalizable strategic behavior and the problem of perfection. (English) Zbl 0552.90097

Pearce, David G.

Econometrica 52, 1029-1050 (1984).

Summary: This paper explores the fundamental problem of what can be inferred about the outcome of a noncooperative game, from the rationality of the players and from the information they possess. The answer is summarized in a solution concept called rationalizability. Strategy profiles that are rationalizable are not always Nash equilibria; conversely, the information in an extensive form game often allows certain “unreasonable” Nash equilibria to be excluded from the set of rationalizable profiles. A stronger form of rationalizability is appropriate if players are known to be not merely “rational” but also “cautious”.

MSC:

91A10	Noncooperative games
91A26	Rationality and learning in game theory

Keywords:

rationalizable strategic behavior; noncooperative game; Nash equilibria; rationalizability