How burning money requires a lot of rationality to be effective

C. Seel, P. Wichardt

Research output: Contribution to journalArticleAcademicpeer-review

Abstract

This paper proposes an extension of the valuation equilibrium concept (Jehiel and Samet, 2007), which partly endogenises the underlying grouping of actions. The effect on equilibrium predictions is illustrated in a burning money game. 

Original languageEnglish
Pages (from-to)111-113
Number of pages3
JournalEconomics Letters
Volume115
Issue number1
DOIs
Publication statusPublished - Apr 2012

Keywords

  • Bounded rationality
  • Burning money
  • Forward induction
  • Valuation equilibrium
  • INDUCTION

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