Caution is an integral part of many solution concepts in traditional game theory and is commonly modelled using lexicographic beliefs. We show here that lexicographic beliefs lack the expressive power to model caution once we extend traditional games to psychological games. Quantification of the relation of ‘deeming an event infinitely more likely than another event’ is necessary, which can be accomplished by using non-standard beliefs.
|Series||EPICENTER Working Paper|
- c72 - Noncooperative Games
- d03 - Behavioral Economics: Underlying Principles
- d83 - "Search; Learning; Information and Knowledge; Communication; Belief"
- Lexicographic beliefs
- Non-standard beliefs
- Psychological games
- Epistemic game theory