Robust equilibrium outcomes in sequential games under almost common certainty of payoffs
Journal article: We analyze the robustness of equilibria in sequential games when there is almost common certainty of payoffs. We show that a generic extensive-form game may have no robust equilibrium behavior, but has at least one robust equilibrium outcome, which is induced by a proper equilibrium in its normal-form representation. Therefore, backward induction leads to a unique robust outcome in a generic perfect-information game. We also discuss close relation between robustness to incomplete information and strategic stability. Finally, we present the implications of our results for the robustness of subgame-perfect implementation.
Author(s)
Satoru Takahashi, Olivier Tercieux
Journal
- Journal of Economic Theory
Date of publication
- 2020
Keywords JEL
Keywords
- Incomplete information
- Robustness
- Higher-order beliefs
- Refinements
- Subgame-perfect implementation
URL of the HAL notice
Version
- 1
Volume
- 188