Credible equilibrium

Mehmet S. Ismail

Papers from arXiv.org

Abstract: Credible equilibrium is a solution concept that imposes a stronger credibility notion than subgame perfect equilibrium. A credible equilibrium is a refinement of subgame perfect equilibrium such that if a threat in a subgame g is "credible," then it must also be credible in every subgame g' that is "equivalent" to g. I show that (i) a credible equilibrium exists in multi-stage games, and (ii) if every stage game has a unique Nash equilibrium, then the credible equilibrium is unique even in infinite horizon multi-stage games. Moreover, in perfect information games, credible equilibrium is equivalent to subgame perfect equilibrium.

Date: 2022-06
New Economics Papers: this item is included in nep-dem, nep-gth and nep-mic
References: Add references at CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2206.05241 Latest version (application/pdf)

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:arx:papers:2206.05241

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().