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(ref:general-theory-equilibrium-selection-games-selton,Harsayini)

Transformation of Extensive form game to strategic(or Normal form) game


Stability diagram of the game
Nave Bayesian Approach
Given the complete prior vector,p entertained by the Players
Expectations of each player,i about theother players strategies will be expressed
by the
i-incomplete prior vectorp-iderived from p.(ie,without including p vector)
ie, he will choose a strategyqiothat is his Best reply to

Credible & Incredible Threats


A threat is noncredible (incredible) if it is not in the player's interest to
carry out this threat when he has an opportunity to do so.
In a game of perfect information, a credible threat can be derived from
backward induction. An incredible threat results in a Nash equilibrium
that cannot be derived by backward induction.

Common knowledge of rationality (CKR) and consistent


alignment of beliefs (CAB)

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