The equivalence of the Dekel-Fudenberg iterative procedure and weakly perfect rationalizability

P.J.J. Herings*, VJ Vannetelbosch

*Corresponding author for this work

    Research output: Contribution to journalArticleScientificpeer-review

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    Abstract

    Two approaches have been proposed in the literature to refine the rationalizability solution concept: either assuming that a player believes that with small probability her opponents choose strategies that are irrational, or assuming that their is a small amount of payoff uncertainty. We show that both approaches lead to the same refinement if strategy perturbations are made according to the concept of weakly perfect rationalizability, and if there is payoff uncertainty as in Dekel and Fudenberg [J, of Econ. Theory 52 (1990), 243-267], For both cases, the strategies that survive are obtained by starting with one round of elimination of weakly dominated strategies followed by many rounds of elimination of strictly dominated strategies.

    Original languageEnglish
    Pages (from-to)677-687
    Number of pages11
    JournalEconomic Theory
    Volume15
    Issue number3
    DOIs
    Publication statusPublished - May 2000

    Keywords

    • rationalizability
    • refinements
    • STRATEGIC BEHAVIOR
    • RATIONALITY
    • GAMES

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