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Models of reflexive decision-making

Novikov D., Chkhartishvili A.

Systems Science

2004

Vol. 30, no 2

45-59

The paper contains a survey of the game-theoretical models of reflexive decision-making. In most equilibrium concepts, used in the game theory, the parameters of the game are common knowledge - all agents know it, all agents know that all agents know it and so on ad infinitum. In general case the agents have different beliefs about beliefs of each other, thus an infinite (reflexive) belief structure appears. For this case, the concept of informational equilibrium is fruitful. The paper is devoted to the formulation of the reflexive model, and contains conditions of the reflexive equilibrium existence and stability, solution of the reflexivity depth problem for some cases, and examples.