Incomplete Information and Equilibrium

Speaker
Andres Perea
Date
19/12/2017 - 13:00 - 11:30Add To Calendar 2017-12-19 11:30:00 2017-12-19 13:00:00 Incomplete Information and Equilibrium Paper: http://www.epicenter.name/wp-content/uploads/2017/09/Incomplete-Info-Eq-WP.pdf In games with incomplete information Bayesian equilibrium constitutes the prevailing solution concept. We show that Bayesian equilibrium generalizes correlated equilibrium from complete to incomplete information. In particular, we provide an epistemic characterization of Bayesian equilibrium as well as of correlated equilibrium in terms of common belief in rationality and a common prior. Bayesian equilibrium is thus not the incomplete information counterpart of Nash equilibrium. To fill the resulting gap, we introduce the solution concept of generalized Nash equilibrium as the incomplete information analogue to Nash equilibrium, and show that it is more restrictive than Bayesian equilibrium. Joint work with Christian Bach Economics building (504), faculty lounge on the first floor אוניברסיטת בר-אילן - המחלקה לכלכלה Economics.Dept@mail.biu.ac.il Asia/Jerusalem public
Place
Economics building (504), faculty lounge on the first floor
Affiliation
Maastricht University
Abstract

Paper: http://www.epicenter.name/wp-content/uploads/2017/09/Incomplete-Info-Eq-WP.pdf

In games with incomplete information Bayesian equilibrium constitutes the prevailing solution concept. We show that Bayesian equilibrium generalizes correlated equilibrium from complete to incomplete information. In particular, we provide an epistemic characterization of Bayesian equilibrium as well as of correlated equilibrium in terms of common belief in rationality and a common prior. Bayesian equilibrium is thus not the incomplete information counterpart of Nash equilibrium. To fill the resulting gap, we introduce the solution concept of generalized Nash equilibrium as the incomplete information analogue to Nash equilibrium, and show that it is more restrictive than Bayesian equilibrium.

Joint work with Christian Bach

תאריך עדכון אחרון : 13/11/2017