Abstract
This paper presents a sound and complete logical system whose atomic sentences are the equalities of recursive terms involving sets. There are two interpretations of this language: one makes use of non-wellfounded sets with finite transitive closure, and the other uses pointed finite graphs modulo bisimulation. Our logical system is a sequent-style deduction system. The main axioms and inference rules come from the $\mbox{{\it FLR}$_0$}$ -proof system from [6], including the Recursion Inference Rule (but an additional axiom is needed), and also axioms corresponding to the extensionality axiom of set theory.
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