Friday, 17 March, 2023 | 14:00 | Micro Theory Research Seminar

Francesc Dilmé (University of Bonn) "Lexicographic Numbers in Extensive Form Games"

Prof. Francesc Dilmé 

University of Bonn, Germany

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Abstract: This paper introduces the space of (lexicographic) ℓ-numbers and uses it to analyze extensive form games. ℓ-Numbers are a simplified, two-dimensional version of the hyperreal numbers, with straightforward operations that make it easy to work with infinitesimal probabilities. We use ℓ-numbers to provide simple characterizations of tremble-based equilibrium concepts, such as sequential equilibria or sequential stable outcomes, without using sequences of strategy profiles.

JEL Classification: C72, C73
Keywords: Lexicographic numbers, sequential equilibrium, stable outcome

Full Text: Lexicographic Numbers in Extensive Form Games