On Games and Equilibria with Coherent Lower Expectations

Giuseppe De Marco and Maria Romaniello ()
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Maria Romaniello: Seconda Università di Napoli

CSEF Working Papers from Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy

Abstract: Different solution concepts for strategic form games have been introduced in order to weaken the consistency assumption that players' beliefs - about their opponents strategic choices - are correct in equilibrium. The literature has shown that ambiguous beliefs are an appropriate device to deal with this task. In this note, we introduce an equilibrium concept in which players do not know the opponents' strategies in their entirety but only the coherent lower expectations of some random variables that depend on the actual strategies taken by the others. This equilibrium concept generalizes the already existing concept of equilibrium with partially specified probabilities by extending the set of feasible beliefs and allowing for comparative probability judgements. We study the issue of the existence of the equilibrium points in our framework and find that equilibria exist under rather classical assumptions.

Date: 2015-04-01
New Economics Papers: this item is included in nep-gth, nep-hpe and nep-mic
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Citations: View citations in EconPapers (1)

Published in Mathematical Problems in Engineering, Volume 2015 (2015), Article ID 690295, 8 pages.

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Journal Article: On Games and Equilibria with Coherent Lower Expectations (2015)
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