Depth of reasoning and higher order beliefs

Tomasz Strzalecki

Journal of Economic Behavior & Organization, 2014, vol. 108, issue C, 108-122

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.

Keywords: k-Level thinking; Email game; Equilibrium; Higher order beliefs (search for similar items in EconPapers)
JEL-codes: C72 D03 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167268114002327
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Depth of Reasoning and Higher Order Beliefs (2014)
Working Paper: Depth of Reasoning and Higher Order Beliefs
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:eee:jeborg:v:108:y:2014:i:c:p:108-122

DOI: 10.1016/j.jebo.2014.09.002

Access Statistics for this article

Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

More articles in Journal of Economic Behavior & Organization from Elsevier
Bibliographic data for series maintained by Catherine Liu ().