Please use this identifier to cite or link to this item: https://doi.org/10.1016/j.jmateco.2009.06.005
Title: The foundation of stability in extensive games with perfect information
Authors: Luo, X. 
Keywords: Common knowledge
Extensive games
Rationality
Stable sets
Issue Date: 2009
Source: Luo, X. (2009). The foundation of stability in extensive games with perfect information. Journal of Mathematical Economics 45 (12) : 860-868. ScholarBank@NUS Repository. https://doi.org/10.1016/j.jmateco.2009.06.005
Abstract: This paper studies the decision-theoretic foundation for the notion of stability in the dynamic context of strategic interaction. We formulate and show that common knowledge of rationality implies a "stable" pattern of behavior in extensive games with perfect information. In the "generic" case, our approach is consistent with Aumann's [Aumann, R.J., 1995. Backward induction and common knowledge of rationality. Games and Economic Behavior 8, 6-19] result that common knowledge of rationality leads to the backward induction outcome.©2009 Elsevier B.V. All rights reserved.
Source Title: Journal of Mathematical Economics
URI: http://scholarbank.nus.edu.sg/handle/10635/19984
ISSN: 03044068
DOI: 10.1016/j.jmateco.2009.06.005
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