Common reasoning in games: A Lewisian analysis of common knowledge of rationality

Robin Cubitt and Robert Sugden

No 11-05, Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) from School of Economics, University of East Anglia, Norwich, UK.

Abstract: The game-theoretic assumption of 'common knowledge of rationality' leads to paradoxes when rationality is represented in a Bayesian framework as cautious expected utility maximisation with independent beliefs (ICEU). We diagnose and resolve these paradoxes by presenting a new class of formal models of players' reasoning, inspired by David Lewis's account of common knowledge, in which the analogue of common knowledge is derivability in common reason. We show that such models can consistently incorporate any of a wide range of standards of decision-theoretic practical rationality. We investigate the implications arising when the standard of decision-theoretic rationality so assumed is ICEU.

Keywords: Common reasoning; common knowldege; common knowledge of rationality; David Lewis; Bayesian models of games (search for similar items in EconPapers)
JEL-codes: C72 (search for similar items in EconPapers)
Date: 2011-02-01
References: View references in EconPapers View complete reference list from CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: COMMON REASONING IN GAMES: A LEWISIAN ANALYSIS OF COMMON KNOWLEDGE OF RATIONALITY (2014)
Working Paper: Common reasoning in games: a Lewisian analysis of common knowledge of rationality (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:uea:wcbess:11-05

Ordering information: This working paper can be ordered from
Reception, School of Economics, University of East Anglia, Norwich Research Park, Norwich, NR4 7TJ, UK

Access Statistics for this paper

More papers in Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) from School of Economics, University of East Anglia, Norwich, UK. Contact information at EDIRC.
Bibliographic data for series maintained by Cara Liggins ().