Iterated Expectations with Common Beliefs

Alfredo Di Tillio ()

Game Theory and Information from EconWPA

Abstract: This paper generalizes a result by Samet concerning iterated expecta- tions and common priors. When a player in some state of the world is allowed to ascribe probability zero to that state, something not allowed in Samet s framework, iterated expectations may not converge, and when they do, common knowledge of their limit may not characterize a common prior. It is shown here that replacing common knowledge with common belief, convergence is still lost in general, but when it obtains, the full characterization is restored.

JEL-codes: C7 D8 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-gth
Date: 2002-09-24
Note: Type of Document - PDF; prepared on LaTeX; to print on Postscript; pages: 5; figures: included/request from author/draw your own
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpga:0209004

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