Fixed-Equilibrium Rationalizability in Signaling Games*

This paper studies equilibrium refinements in signaling games through an examination of rationalizability in derived games obtained by replacing the equilibrium path with a sure outcome that yields the equilibrium payoff to ail players. The informed player chooses between the sure payoff and sending an out-of-equilibrium signal from the original game. Whether or not the strategy of choosing the sure payoff is rationalizable is related to the iterated intuitive condition (divinity) when the original game is viewed as having imperfect (incomplete) information. Our results also demonstrate the significance of testing out-of-equilibrium signals as a set rather than individually. Journal of Economic Literature Classification Numbers: 021, 022, 026.