Abstract

Describing the interactional behavior of rational agents and seeking equilibria are two main domains of game theory. The epistemic foundation of the above two domains is based on the assumption that all players are rational. However, game theory itself cannot precisely model the higher-order information changes of mutual knowledge among players, so in the current studies of game theory the interpretations of rationality are vague. In this paper, a concept of the rationality is redefined through incorporating an epistemic ingredient. Then a method is proposed to solve and refine Nash equilibria which is grounded on public announcement logic, and it is proved that the iterated announcement of this rationality assertion characterizes the iterated admissibility algorithm in game theory, which offers a dynamic epistemic foundation for this algorithm. Finally, an implementation of this method, based on the extended DEMO, is shown to be correct.

Full Text

Published Version (Free)

Talk to us

Join us for a 30 min session where you can share your feedback and ask us any queries you have

Schedule a call

Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.