Depth of Reasoning and Higher Order Beliefs

Tomasz Strzalecki

Scholarly Articles from Harvard University Department of Economics

Abstract: As demonstrated by the email game of Rubinstein (1989), the predictions of the standard equilibrium models of game theory are sensitive to assumptions about the fine details of the higher order beliefs. This paper shows that models of bounded depth of reasoning based on level-k thinking or cognitive hierarchy make predictions that are independent of the tail assumptions on the higher order beliefs. The framework developed here provides a language that makes it possible to identify general conditions on depth of reasoning, instead of committing to a particular model such as level-k thinking or cognitive hierarchy.

Date: 2014
New Economics Papers: this item is included in nep-gth and nep-neu
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Citations: View citations in EconPapers (22)

Published in Journal of Economic Behavior & Organization

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Related works:
Journal Article: Depth of reasoning and higher order beliefs (2014)
Working Paper: Depth of Reasoning and Higher Order Beliefs
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Persistent link: https://EconPapers.repec.org/RePEc:hrv:faseco:14397608

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