Purification and disambiguation of Ellsberg equilibria

Benoît Decerf () and Frank Riedel

Economic Theory, 2020, vol. 69, issue 3, No 3, 595-636

Abstract: Abstract Recently, the use of Knightian (uncertain) strategies in normal form games has received increasing attention. The use of uncertain acts in games leads to new (Ellsberg) equilibria. We provide a foundation of the new equilibrium concept in the spirit of Harsanyi by proving an extension of the Purification Theorem for $$2\times 2$$2×2 normal form games. Our result implies that Ellsberg equilibria are limits of equilibria in slightly perturbed games with private information. In such equilibria, players use pure or maxmin strategies only.

Keywords: Knightian uncertainty; Ellsberg games; Ambiguity aversion; Purification; Disambiguation (search for similar items in EconPapers)
JEL-codes: C72 D81 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://link.springer.com/10.1007/s00199-019-01186-8 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
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:spr:joecth:v:69:y:2020:i:3:d:10.1007_s00199-019-01186-8

Ordering information: This journal article can be ordered from
http://www.springer. ... eory/journal/199/PS2

DOI: 10.1007/s00199-019-01186-8

Access Statistics for this article

Economic Theory is currently edited by Nichoals Yanneils

More articles in Economic Theory from Springer, Society for the Advancement of Economic Theory (SAET) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().