Do players reason by forward induction in dynamic perfect information games?

Do players reason by forward induction in dynamic perfect information games?

We conducted an experiment where participants played a perfect-information game against a computer, which was programmed to deviate often from its backward induction strategy right at the beginning of the game. Participants knew that in each game, the computer was nevertheless optimizing against some belief about the participant’s future strategy. It turned out that in the aggregate, participan...

Dynamic Games with Perfect Awareness Information

I study dynamic games where players may be unaware of some fundamentals of the game itself, such as actions or players, and such unawareness may be lifted by other players’ actions during the play. Based on Li (2006a, 2006b), I propose a framework to deal with such games using standard tools of game theory. I construct examples to show that unawareness is distinctly different from assigning zer...

Forward Induction, Strong Beliefs, and Unawareness in Dynamic Psychological Games

We provide an epistemic model of dynamic psychological games with unawareness. To formulate epistemic statements, we extend Battigalli and Siniscalchi (1999)’s hierarchies of conditional beliefs by constructing a space of infinite (coherent) hierarchies for each possible awareness level. The interpretation is that only hierarchies of beliefs at the highest awareness level are full descriptions ...

Branching Time, Perfect Information Games, and Backward Induction

The logical foundations of game-theoretic solution concepts have so far been explored within the con ̄nes of epistemic logic. In this paper we turn to a di®erent branch of modal logic, namely temporal logic, and propose to view the solution of a game as a complete prediction about future play. The branching time framework is extended by adding agents and by de ̄ning the notion of prediction. A sy...

Games with Perfect Information