Journal Of The Econometric Society

An International Society for the Advancement of Economic
Theory in its Relation to Statistics and Mathematics

Edited by: Guido W. Imbens • Print ISSN: 0012-9682 • Online ISSN: 1468-0262

Econometrica: May, 1993, Volume 61, Issue 3

Self-Confirming Equilibrium<523:SE>2.0.CO;2-I
p. 523-545

David K. Levine, Drew Fudenberg

In a self-confirming equilibrium, each player's strategy is a best response to his beliefs about the play of his opponents, and each player's beliefs are correct along the equilibrium path of play. Thus, if a self-confirming equilibrium occurs repeatedly, no player ever observes play that contradicts his beliefs, even though beliefs about play at off-path information sets need not be correct. We characterize the ways in which self-confirming equilibria and Nash equilibria can differ, and provide conditions under which self-confirming equilibria correspond to standard solution concepts.

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