“Generalized Belief Operator and the Impact of Small Probability Events on Higher Order Beliefs” by Satoru Takahashi
Economics Seminar
Authors:
Satoru Takahashi
National University of SingaporeDaisuke Oyama
University of Tokyo
We explore the restrictions that prior beliefs impose on higher order beliefs. We consider a generalization of belief operator, introduce a notion of potential, and study implications of existence/non-existence of a potential with a certain property. In particular, we obtain a nontrivial lower bound of the prior probability of a common belief event that is uniform over type spaces. As an application, a full characterization of robust equilibrium is obtained for binary supermodular games.
