Branching Time, Perfect Information Games, and Backward Induction

Abstract

The logical foundations of game-theoretic solution concepts have so far been explored within the confines of epistemic logic. In this paper we turn to a different branch of modal logic, namely temporal logic, and propose to view the solution of a game as a complete prediction about future play. The branching time framework is extended by adding agents and by defining the notion of prediction. A syntactic characterization of backward induction in terms of the property of internal consistency of prediction is given. Journal of Economic Literature Classification Numbers: C70, C72.