Mindreading and Endogenous Beliefs in Games

Lauren Larrouy and Guilhem Lecouteux

No 2017-01, GREDEG Working Papers from Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France

Abstract: We argue that a Bayesian explanation of strategic choices in games requires introducing a psychological theory of belief formation. We highlight that beliefs in epistemic game theory are derived from the actual choice of the players, and cannot therefore explain why Bayesian rational players should play the strategy they actually chose. We introduce the players’ capacity of mindreading in a game theoretical framework with the simulation theory, and characterise the beliefs that Bayes rational players could endogenously form in games. We show in particular that those beliefs need not be ratifiable, and therefore that rational players can form action-dependent beliefs.

Keywords: prior beliefs; mindreading; simulation; action-dependent beliefs; choice under uncertainty (search for similar items in EconPapers)
JEL-codes: B41 C72 D81 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2017-01, Revised 2017-06
New Economics Papers: this item is included in nep-gth, nep-hpe, nep-mic, nep-neu and nep-ore
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Forthcoming in Journal of Economic Methodology

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http://www.gredeg.cnrs.fr/working-papers/GREDEG-WP-2017-01.pdf Revised version, 2017-06 (application/pdf)
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Related works:
Journal Article: Mindreading and endogenous beliefs in games (2017)
Working Paper: Mindreading and endogenous beliefs in games (2017)
Working Paper: Mindreading and Endogenous Beliefs in Games (2017)
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