TY - JOUR
T1 - On the outcome equivalence of backward induction and extensive form rationalizability
AU - Heifetz, Aviad
AU - Perea, Andrés
N1 - Publisher Copyright:
© Springer-Verlag Berlin Heidelberg 2014.
PY - 2015/3/19
Y1 - 2015/3/19
N2 - Abstract Pearce’s (Econometrica 52:1029–1050, 1984) extensive-form rationalizablity (EFR) is a solution concept embodying a best-rationalization principle (Battigalli, Games Econ Behav 13:178–200, 1996; Battigalli and Siniscalchi, J Econ Theory 106:356–391, 2002) for forward-induction reasoning. EFR strategies may hence be distinct from backward-induction (BI) strategies.We provide a direct and transparent proof that, in perfect-information games with no relevant ties, the unique BI outcome is nevertheless identical to the unique EFR outcome, even when the EFR strategy profile and the BI strategy profile are distinct.
AB - Abstract Pearce’s (Econometrica 52:1029–1050, 1984) extensive-form rationalizablity (EFR) is a solution concept embodying a best-rationalization principle (Battigalli, Games Econ Behav 13:178–200, 1996; Battigalli and Siniscalchi, J Econ Theory 106:356–391, 2002) for forward-induction reasoning. EFR strategies may hence be distinct from backward-induction (BI) strategies.We provide a direct and transparent proof that, in perfect-information games with no relevant ties, the unique BI outcome is nevertheless identical to the unique EFR outcome, even when the EFR strategy profile and the BI strategy profile are distinct.
KW - Backward induction
KW - Extensive-form rationalizability
KW - Forward induction
UR - http://www.scopus.com/inward/record.url?scp=84896412550&partnerID=8YFLogxK
U2 - 10.1007/s00182-014-0418-x
DO - 10.1007/s00182-014-0418-x
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AN - SCOPUS:84896412550
SN - 0020-7276
VL - 44
SP - 37
EP - 59
JO - International Journal of Game Theory
JF - International Journal of Game Theory
IS - 1
ER -