The prelims comprise: Strategic Interaction Nash Equilibrium Normal‐form Refinements Games in Extensive Form Extensive‐form Refinements Selection by Evolution Notes.

Rational choice theory enjoys unprecedented popularity and influence in the behavioral and social sciences, but it generates intractable problems when applied to socially interactive decisions. In individual decisions, instrumental rationality is defined in terms of expected utility maximization. This becomes problematic in interactive decisions, when individuals have only partial control over the outcomes, because expected utility maximization is undefined in the absence of assumptions about how the other participants will behave. Game theory therefore incorporates not only rationality (...) but also common knowledge assumptions, enabling players to anticipate their co-players' strategies. Under these assumptions, disparate anomalies emerge. Instrumental rationality, conventionally interpreted, fails to explain intuitively obvious features of human interaction, yields predictions starkly at variance with experimental findings, and breaks down completely in certain cases. In particular, focal point selection in pure coordination games is inexplicable, though it is easily achieved in practice; the intuitively compelling payoff-dominance principle lacks rational justification; rationality in social dilemmas is self-defeating; a key solution concept for cooperative coalition games is frequently inapplicable; and rational choice in certain sequential games generates contradictions. In experiments, human players behave more cooperatively and receive higher payoffs than strict rationality would permit. Orthodox conceptions of rationality are evidently internally deficient and inadequate for explaining human interaction. Psychological game theory, based on nonstandard assumptions, is required to solve these problems, and some suggestions along these lines have already been put forward. Key Words: backward induction; Centipede game; common knowledge; cooperation; epistemic reasoning; game theory; payoff dominance; pure coordination game; rational choice theory; social dilemma. (shrink)

David Lewis is widely credited with the first formulation of common knowledge and the first rigorous analysis of convention. However, common knowledge and convention entered mainstream game theory only when they were formulated, later and independently, by other theorists. As a result, some of the most distinctive and valuable features of Lewis' game theory have been overlooked. We re-examine this theory by reconstructing key parts in a more formal way, extending it, and showing how it (...) differs from more recent game theory. In contrast to current theories of common knowledge, Lewis' theory is based on an explicit analysis of the modes of reasoning that are accessible to rational individuals and so can be used to analyse the genesis of common knowledge. Lewis' analysis of convention emphasises the role of inductive reasoning and of salience in the maintenance of conventions over time. Footnotes Earlier versions of this paper were presented at the 13th Amsterdam Colloquium at the University of Amsterdam, at a workshop on social norms at Wissenschaftskolleg zu Berlin, and at seminars at Tilburg University and the University of Bristol. We are grateful for comments from participants at those meetings, from two anonymous referees, and from Michael Bacharach, Nick Bardsley, Cristina Bicchieri, Luc Bovens, Simon Grant, David McCarthy, Shepley Orr, Brian Skyrms, Peter Vanderschraaf, Peter Wakker and Jörgen Weibull. Robert Sugden's work was supported by the Leverhulme Trust. (shrink)

The standard backward-induction reasoning in a game like the centipede assumes that the players maintain a common belief in rationality throughout the game. But that is a dubious assumption. Suppose the first player X didn't terminate the game in the first round; what would the second player Y think then? Since the backwards-induction argument says X should terminate the game, and it is supposed to be a sound argument, Y might be entitled to doubt X's rationality. (...) Alternatively, Y might doubt that X believes Y is rational, or that X believes Y believes X is rational, or Y might have some higher-order doubt. X’s deviant first move might cause a breakdown in common belief in rationality, therefore. Once that goes, the entire argument fails. The argument also assumes that the players act rationally at each stage of the game, even if this stage could not be reached by rational play. But it is also dubious to assume that past irrationality never exerts a corrupting influence on present play. However, the backwards-induction argument can be reconstructed for the centipede game on a more secure basis.1 It may be implausible to assume a common belief in rationality throughout the game, however the game might go, but the argument requires less than this. The standard idealisations in game theory certainly allow us to assume a common belief in rationality at the beginning of the game. They also allow us to assume this common belief persists so long as no one makes an irrational move. That is enough for the argument to go through. (shrink)

Equilibrium game theory borrows from neoclassical economics its rationality concept which it immediately puts to work in order to produce the basic results it needs for building an elaborate narrative of social interaction. This paper focuses on some recent objections to game theory's use of rationality assumptions in general, and of backward induction and subgame perfection in particular, and interprets them in the light of the postmodern critique of the grand meta-narratives which social theorists often rely (...) on for social explanation. The paper presents a defence of game theory which seeks to accommodate the postmodern critique. However, it goes on to show that such a defence is illegitimate and claims that the problem lies with the faulty conceptualisation of the main concept on which game theory rests: that of Reason. Having established the nature of the problem, it considers three alternative interpretations (Humean, postmodern and Hegelian) of why the problem resists logical solutions and of its significance for social theory. (shrink)

This collection of papers in epistemic logic is oriented towards applications to game theory and individual decision theory. Most of these papers were presented at the inaugural conference of the LOFT (Logic for the Theory and Games and Decisions) conference series, which took place in 1994 in Marseille. Among the notions dealt with are those of common knowledge and common belief, infinite hierarchies of beliefs and belief spaces, logical omniscience, positive and negative introspection, backward induction and (...) rationalizable equilibria in game theory. (shrink)

This paper proposes a game-theoretic solution of the surprise examination problem. It is argued that the game of “matching pennies” provides a useful model for the interaction of a teacher who wants her exam to be surprising and students who want to avoid being surprised. A distinction is drawn between prudential and evidential versions of the problem. In both, the teacher should not assign a probability of zero to giving the exam on the last day. This representation of (...) the problem provides a diagnosis of where the backwards induction argument, which “proves” that no surprise exam is possible, is mistaken. (shrink)

Backward induction has been the standard method of solving finite extensive-form games with perfect information, notwithstanding the fact that this procedure leads to counter-intuitive results in various games. However, beginning in the late eighties, the method of backward induction became an object of criticism. It is claimed that the assumptions needed for its defence are quite implausible, if not incoherent. It is therefore natural to ask for the justification of backward induction: Can one show that rational players who know the (...) structure of the game, have trust in each other's practical rationality and reason correctly, will act in accordance in backward induction? Several researchers have tried a justification of this kind, but the argument presented in Robert Aumann's paper from 1995 is perhaps the most well-known and influential attempt to provide such a justification. Clausing provides a sustained discussion of the justification problem for backward induction. It is an excellent work and the criticism I will present below does not detract from this evaluation: the issues discussed by the author are complex and it is difficult to get everything right. Furthermore, I hope that the criticism to be presented may be instructive; Even though it has not been Clausing's intention, his logical reconstruction of Aumann's defence of backward induction allows us to see very clearly what is wrong with that argument. It also provides us with * This paper was presented at workshops in Lund and in Uppsala, in the Fall of 1999. I am indebted to the participants for their useful comments. The work on the paper was supported by a generous research grant from The Bank of Sweden Tercentenary Foundation. (shrink)

We provide eductive foundations for the concept of forward induction, in the class of games with an outside option. The formulation presented tries to capture in a static notion the rest point of an introspective process, achievable from some restricted preliminary beliefs. The former requisite is met by requiring the rest point to be a Nash equilibrium that yields a higher payoff than the outside option. With respect to the beliefs, we propose the Incentive Dominance Criterion. Players should consider one (...) action more likely than another whenever the former is better than getting the outside option for more conjectures over his rival's actions. We apply this model to the case where the subgame is a coordination game with a conflict between payoff dominance and risk dominance. Our results provide support for dominance solvability, but not for Van Damme's notion of forward induction. We show how the forward induction logic helps to select the Pareto dominant equilibrium. This is the case whenever player 1's act of giving up the outside option reverses the incentive dominance relations among 1's pure actions in the subgame. (shrink)

According to the standard objection to backward induction in games, its application depends on highly questionable assumptions about the players' expectations as regards future counterfactual game developments. It seems that, in order to make predictions needed for backward reasoning, the players must expect each player to act rationally at each node that in principle could be reached in the game, and also to expect that this confidence in the future rationality of the players would be kept by each (...) player come what may: even at the game-nodes that could only be reached by irrational play. Both expectations seem to be rather unreasonable: a player's initial disposition to rational behaviour may be weakened by a long stretch of irrational play on his part and, even more importantly, his initial confidence in the other players' future rationality may be undermined by an irrational play on their part. For different formulations of this objection see Binmore, Reny and, Bicchieri, Pettit and Sugden. and Aumann and.). (shrink)

We present an axiomatic approach for a class of finite, extensive form games of perfect information that makes use of notions like “rationality at a node” and “knowledge at a node.” We distinguish between the game theorist's and the players' own “theory of the game.” The latter is a theory that is sufficient for each player to infer a certain sequence of moves, whereas the former is intended as a justification of such a sequence of moves. (...) While in general the game theorist's theory of the game is not and need not be axiomatized, the players' theory must be an axiomatic one, since we model players as analogous to automatic theorem provers that play the game by inferring (or computing) a sequence of moves. We provide the players with an axiomatic theory sufficient to infer a solution for the game (in our case, the backwards induction equilibrium), and prove its consistency. We then inquire what happens when the theory of the game is augmented with information that a move outside the inferred solution has occurred. We show that a theory that is sufficient for the players to infer a solution and still remains consistent in the face of deviations must be modular. By this we mean that players have distributed knowledge of it. Finally, we show that whenever the theory of the game is group-knowledge (or common knowledge) among the players (i.e., it is the same at each node), a deviation from the solution gives rise to inconsistencies and therefore forces a revision of the theory at later nodes. On the contrary, whenever a theory of the game is modular, a deviation from equilibrium play does not induce a revision of the theory. (shrink)

A cornerstone of game theory is backward induction, whereby players reason backward from the end of a game in extensive form to the beginning in order to determine what choices are rational at each stage of play. Truels, or three-person duels, are used to illustrate how the outcome can depend on (1) the evenness/oddness of the number of rounds (the parity problem) and (2) uncertainty about the endpoint of the game (the uncertainty problem). Since there is (...) no known endpoint in the latter case, an extension of the idea of backward induction is used to determine the possible outcomes. The parity problem highlights the lack of robustness of backward induction, but it poses no conflict between foundational principles. On the other hand, two conflicting views of the future underlie the uncertainty problem, depending on whether the number of rounds is bounded (the players invariably shoot from the start) or unbounded (they may all cooperate and never shoot, despite the fact that the truel will end with certainty and therefore be effectively bounded). Some real-life examples, in which destructive behavior sometimes occurred and sometimes did not, are used to illustrate these differences, and some ethical implications of the analysis are discussed. (shrink)

This paper argues that a view of science, expounded and defended elsewhere, solves the problem of induction. The view holds that we need to see science as accepting a hierarchy of metaphysical theses concerning the comprehensibility and knowability of the universe, these theses asserting less and less as we go up the hierarchy. It may seem that this view must suffer from vicious circularity, in so far as accepting physical theories is justified by an appeal to metaphysical theses in turn (...) justified by the success of science. But this is rebutted. A thesis high up in the hierarchy asserts that the universe is such that the element of circularity, just indicated, is legitimate and justified, and not vicious. Acceptance of the thesis is in turn justified without appeal to the success of science. It may seem that the practical problem of induction can only be solved along these lines if there is a justification of the truth of the metaphysical theses in question. It is argued that this demand must be rejected as it stems from an irrational conception of science. (shrink)

We develop a logical system that captures two different interpretations of what extensive games model, and we apply this to a long-standing debate in game theory between those who defend the claim that common knowledge of rationality leads to backward induction or subgame perfect (Nash) equilibria and those who reject this claim. We show that a defense of the claim à la Aumann (1995) rests on a conception of extensive game playing as a one-shot event in combination (...) with a principle of rationality that is incompatible with it, while a rejection of the claim à la Reny (1988) assumes a temporally extended, many-moment interpretation of extensive games in combination with implausible belief revision policies. In addition, the logical system provides an original inductive and implicit axiomatization of rationality in extensive games based on relations of dominance rather than the usual direct axiomatization of rationality as maximization of expected utility. (shrink)

We present the notion of finite high-order Gowers games, and prove a statement parallel to Gowers's Combinatorial Lemma for these games. We derive ‘quantitative’ versions of the original Gowers Combinatorial Lemma and of Gowers's Dichotomy, which place them in the context of the recently introduced infinite dimensional asymptotic theory for Banach spaces.

To determine what the speaker in a cooperative dialog meant with his assertion, on top of what he explicitly said, it is crucial that we assume that the assertion he gave was optimal. In determining optimal assertions we assume that dialogs are embedded in decision problems (van Rooij 2003) and use backwards induction for calculating them (Benz 2006). In this paper, we show that in terms of our framework we can account for several types of implicatures in a uniform way, (...) suggesting that there is no need for an independent linguistic theory of generalized implicatures. In the final section, we show how we can embed our theory in the framework of signaling games, and how it relates with other game theoretic analyses of implicatures. (shrink)

Nelson Goodman cast the ‘problem of induction’ as the task of articulating the principles and standards by which to distinguish valid from invalid inductive inferences. This paper explores some logical bounds on the ability of a rational reasoner to accomplish this task. By a simple argument, either an inductive inference method cannot admit its own fallibility, or there exists some non-inferable hypothesis whose non-inferability the method cannot infer (violating the principle of ‘negative introspection’). The paper discusses some implications (...) of this limited self-knowledge for the justifiability of inductive inferences, auto-epistemic logic, and the epistemic foundations of game theory. (shrink)

Backwards induction is an intriguing form of argument. It is used in a number of different contexts. One of these is the surprise exam paradox. Another is game theory. But its use is problematic, at least sometimes. The purpose of this paper is to determine what, exactly, backwards induction is, and hence to evaluate it. Let us start by rehearsing informally some of its problematic applications.

Normative game theory unsatisfactorily explains rational behavior. Real people do not behave as predicted, and what is prescribed as rational behavior is normally unattainable in real-life. The problem is that current normative analysis does not account for people's cognitive limitations – their bounded rationality. However, this paper develops an account of bounded rationality that explains the rationality of more realistic behavior. I focus on the Centipede Game, in which boundedly rational players explore and test others' immediate behavior, (...) until they can apply limited backward induction. The result is that the game has a solution in the form of a subjective Nash equilibrium, which boundedly rational players can possibly realize. (shrink)

There is a plurality of formal constraints for aggregating probabilities of a group of individuals. Different constraints characterise different families of aggregation rules. In this paper, we focus on the families of linear and geometric opinion pooling rules which consist in linear, respectively, geometric weighted averaging of the individuals’ probabilities. For these families, it is debated which weights exactly are to be chosen. By applying the results of the theory of meta-induction, we want to provide a general rationale, namely, (...) optimality, for choosing the weights in a success-based way by scoring rules. A major argument put forward against weighting by scoring is that these weights heavily depend on the chosen scoring rule. However, as we will show, the main condition for the optimality of meta-inductive weights is so general that it holds under most standard scoring rules, more precisely under all scoring rules that are based on a convex loss function. Therefore, whereas the exact choice of a scoring rule for weighted probability aggregation might depend on the respective purpose of such an aggregation, the epistemic rationale behind such a choice is generally valid. (shrink)

A large class of games is that of non-cooperative, extensive form games of perfect information. When the length of these games is finite, the method used to reach a solution is that of a backward induction. Working from the terminal nodes, dominated strategies are successively deleted and what remains is a unique equilibrium. Game theorists have generally assumed that the informational requirement needed to solve these games is that the players have common knowledge of rationality. This assumption, however, has (...) given rise to several problems and paradoxes. Most notably, it has been shown that the common knowledge assumption makes the theory of the game inconsistent at some information set. The present paper shows that a) no common knowledge of rationality need be assumed for the backward induction solution to hold. Rather, it is sufficient that the players have a number of levels of knowledge proportional to the length of the game, and b) it is also necessary that the number of levels of knowledge is finite and proportional to the length of the game. For a higher number of levels of knowledge, inconsistencies arise. (shrink)

The backward induction controversy in game theory flared up and then practically ended within a decade – the 1990s. The protagonists, however, did not converge on an agreement about the source of the controversy. Why was this the case, if opposing sides had access to the same modelling techniques and empirical facts? In this paper I offer an explanation for this controversy and its unsettled end. The answer is not to be found in the modelling claims made by (...) the opposing protagonists, but in the tacit metaphors they operate under. Aristotle defined metaphor as giving a 'thing a name that belongs to something else' (Poetica, 1457b). The meaning of metaphors has not changed much since then – in contrast to models which are comparatively new, and still not well-understood, scientific tools. The controversy of backward induction in game theory provides a test bed for the explanatory power of metaphors. This paper frames the controversy in terms of metaphor choice to provide a common framework for the protagonists. This results in the identification of three different domains – mathematical logic, game theory and the world – each connected to the other via different metaphors. The controversy around backward induction is placed in, and tentatively explained by, this framework. (shrink)

In his previous work, the author has introduced the axiom schema of inductive dichotomy, a weak variant of the axiom schema of inductive definition, and used this schema for elementary ) positive operators to separate open and clopen determinacies for those games in which two players make choices from infinitely many alternatives in various circumstances. Among the studies on variants of inductive definitions for bounded ) positive operators, the present article investigates inductive dichotomy for these operators, (...) and applies it to constructive investigations of variants of determinacy statements for those games in which the players make choices from only finitely many alternatives. As a result, three formulations of open determinacy, that are all classically equivalent with each other, are equivalent to three different semi-classical principles, namely Markov’s Principle, Lesser Limited Principle of Omniscience and Limited Principle of Omniscience, over a suitable constructive base theory that proves clopen determinacy. Open and clopen determinacies for these games are thus separated. Some basic results on variants of inductive definitions for \ positive operators will also be given. (shrink)

In this dissertation, I develop a theory of rational inductive deliberation in the context of strategic interaction that generalizes previous theories of inductive deliberation. In this account of inductive deliberation, I model rational deliberators as players engaged in noncooperative games, such that: They are Bayesian rational, in the sense that every deliberator chooses actions that maximize expected utility given the beliefs this deliberator has regarding the other deliberators, and They update their beliefs about one another recursively, (...) using rules of inductive logic. Inductive deliberators update their beliefs until they reach an equilibrium of the game, at which every deliberator maximizes expected utility given the deliberator's beliefs over the actions of the other deliberators. ;The theory of inductive deliberation generalizes previous theories by allowing for the possibility of correlation in the beliefs of the deliberators. Most of the results of noncooperative game theory presuppose that the players strategies are probabilistically independent. I argue that such probabilistic independence assumptions are unfounded, and that agents should take into account the possibility that their opponents' actions are correlated. Relaxing the probabilistic independence assumption in noncooperative game theory leads to various correlated equilibrium concepts, which I argue are the appropriate solution concepts for noncooperative games. Relaxing the independence assumption in the inductive dynamics enables correlation in the deliberators' beliefs to emerge spontaneously, resulting in the deliberators converging to correlated equilibrium. ;I devote the majority of the dissertation to the formal theory of inductive deliberation and correlated equilibrium. In particular, I show the following: Under suitable conditions, correlated equilibria correspond to fixed points of the dynamics, and The dynamics can create correlation in beliefs from an initial uncorrelated state. In the final chapter of the dissertation, I give an account of the origins of social conventions such as the use of particular words in human languages as the result of inductive deliberation. (shrink)

Preference is a basic notion in human behaviour, underlying such varied phenomena as individual rationality in the philosophy of action and game theory, obligations in deontic logic (we should aim for the best of all possible worlds), or collective decisions in social choice theory. Also, in a more abstract sense, preference orderings are used in conditional logic or non-monotonic reasoning as a way of arranging worlds into more or less plausible ones. The field of preference logic (cf. (...) Hansson [10]) studies formal systems that can express and analyze notions of preference between various sorts of entities: worlds, actions, or propositions. The art is of course to design a language that combines perspicuity and low complexity with reasonable expressive power. In this paper, we take a particularly simple approach. As preferences are binary relations between worlds, they naturally support standard unary modalities. In particular, our key modality ♦ϕ will just say that is ϕ true in some world which is at least as good as the current one. Of course, this notion can also be indexed to separate agents. The essence of this language is already in [4], but our semantics is more general, and so are our applications and later language extensions. Our modal language can express a variety of preference notions between propositions. Moreover, as already suggested in [9], it can “deconstruct” standard conditionals, providing an embedding of conditional logic into more standard modal logics. Next, we take the language to the analysis of games, where some sort of preference logic is evidently needed ([23] has a binary modal analysis different from ours). We show how a qualitative unary preference modality suffices for defining Nash Equilibrium in strategic games, and also the Backward Induction solution for finite extensive games. Finally, from a technical perspective, our treatment adds a new twist. Each application considered in this paper suggests the need for some additional access to worlds before the preference modality can unfold its true power.. (shrink)

The theory of rational decision has always been implicitly involved with subjunctive and counterfactual conditionals. “If I were to do A, this would happen; if I were to do B that would happen. ” When I have done A, I use the counterfactual: “If I had done B, the outcome would have been worse. ” Counterfactuals are handled so smoothly in decision theory and game theory that they are hardly ever explicitly discussed except in cases where (...) they cause problems. For many philosophers, Newcomb’s paradox was such a critical case ). In game theory, questions about beliefs off the equilibrium path in extensive form games and related issues of backward and forward induction provoked explicit discussion of counterfactuals , Bicchieri , Binmore , Harsanyi and Selten , Reny , Stalnaker , ). Where subjunctive conditionals cause problems, we need an explicit theory. What theory should we use? There is the selection function semantics of Stalnaker based on the idea of “most similar possible world in which the antecedent is true”, and related theories of Woodruff , Lewis , Pollock , Nute , which relax some of Stalnaker’s assumptions. (shrink)

Many philosophers and game theorists have been struck by the thought that the backward induction argument (BIA) for the finite iterated pris- oner’s dilemma (FIPD) recommends a course of action which is grossly counter-intuitive and certainly contrary to the way in which people behave in real-life FIPD-situations (Luce and Raiffa 1957, Pettit and Sugden 1989, Bovens 1997).1 Yet the backwards induction argument puts itself forward as binding upon rational agents. What are we to conclude from this? Is it that (...) people in real-life FIPD-situations tend to act irrationally and that our own intuitions about what to do in such situations reveal us to be irra- tional? Alternatively, should we abandon game theory and decision theory as a guide to rationality? Or are there other ways in which the apparent disparity between the dictates of rationality and the reality of reasoning can be accommodated? (shrink)

According to decision theory, the rational initial action in a sequential decision-problem may be found by backward induction or folding back. But the reasoning which underwrites this claim appeals to the agent's beliefs about what she will later believe, about what she will later believe she will still later believe, and so forth. There are limits to the depth of people's beliefs. Do these limits pose a threat to the standard theory of rational sequential choice? It is argued, (...) first, that the traditional solutions of certain games depend on knowledge which exceeds depth limits, and that these solutions therefore cannot be shown rational in the usual sense. Then, for that related reason even folding back solutions of one-person problems cannot be! A revision of our notion of rational choice is proposed, analogous to the reliabilist account of knowledge of Goldman and others, by which this paradox is resolved. (shrink)

Two justifications of backward induction (BI) in generic perfect information games are formulated using Bonanno's (1992; Theory and Decision 33, 153) belief systems. The first justification concerns the BI strategy profile and is based on selecting a set of rational belief systems from which players have to choose their belief functions. The second justification concerns the BI path of play and is based on a sequential deletion of nodes that are inconsistent with the choice of rational belief functions.

Vanderschraaf develops a new theory of game theory equilibrium selection in this book. The new theory defends general correlated equilibrium concepts and suggests a new analysis of convention.

La théorie des jeux évolutionnaires s'oppose à la théorie des jeux classique en ce qu 'elle élimine les raisonnements des joueurs. Peut-elle dépasser les apories de la théorie classique ? Mais en reconsidérant le raisonnement classique d'induction rétrograde, en y introduisant des possibilités de révision, on évite son aspect paradoxal. L'intérêt de la théorie des jeux évolutionnaires est donc surtout de simuler l'évolution d'interactions dans des populations.Evolutionary game theory does not take into account reasoning players, in contrast with (...) classical game theory. Can it overcome some drawbacks of classical theory ? If we reconsider the backward induction reasoning, and if introduce the possibility of revising, paradoxes and drawbacks disappear. So the main interest of evolutionary game theoiy consists in the simulation of evolution of interactions among populations. (shrink)

This paper argues that chance (risk or opportunity) discovery is challenging, from a reasoning point of view, because it represents a dilemma for inductive reasoning. Chance discovery shares many features with the grue paradox. Consequently, Bayesian approaches represent a potential solution. The Bayesian solution evaluates alternative models generated using a temporal logic planner to manage the chance. Surprise indices are used in monitoring the conformity of the real world and the assessed probabilities. Game theoretic approaches are proposed to (...) deal with multi-agent interaction in chance management. (shrink)

We conceive of a player in dynamic games as a set of agents, which are assigned the distinct tasks of reasoning and node-specific choices. The notion of agent connectedness measuring the sequential stability of a player over time is then modeled in an extended type-based epistemic framework. Moreover, we provide an epistemic foundation for backward induction in terms of agent connectedness. Besides, it is argued that the epistemic independence assumption underlying backward induction is stronger than usually presumed.

As scientists start to adopt machine learning (ML) as one research tool, the security of ML and the knowledge generated become a concern. In this paper, I explain how supervised ML can be improved with better data ontology, or the way we make categories and turn information into data. More specifically, we should design data ontology in such a way that is consistent with the knowledge that we have about the target phenomenon so that such ontology can help us make (...) the inductive leap. I do so by thinking through a thought experiment, Goodman’s New Riddle of Induction (Fact, fiction, and forecast, Harvard University Press, 1955). Goodman’s riddle helps flesh out three problems of induction: (1) the problem of equal goodies, that there are often too many equally good inductive results given the same data; (2) the problem of diverging performance, that these equally good results can give opposite predictions in the future; and (3) the problem of mediocrity, that when averaged across all equally possible datasets and tasks, no inductive algorithm outperforms any other. I show that all these three problems are manifested as real obstacles in ML practice, namely, the Rashomon effect (Breiman in Stat Sci 16(3):199–231, 2001), the problem of underspecification (D’Amour et al. in J Mach Learn Res, 2020, https://doi.org/10.48550/arXiv.2011.03395 ), and the No Free Lunch theorem (Wolpert in Neural Comput 8(7):1341–90, 1996, https://doi.org/10.1162/neco.1996.8.7.1341 ). Lastly, I argue that proper data ontology can help mitigate these problems and I demonstrate how using concrete examples from climate science. This research highlights the links between philosophers’ discussions of induction and implications in ML practice. (shrink)

The problem of finding sufficient doxastic conditions for backward induction in games of perfect information is analyzed in a syntactic framework with subjunctive conditionals. This allows to describe the structure of the game by a logical formula and consequently to treat beliefs about this structure in the same way as beliefs about rationality. A backward induction and a non-Nash equilibrium result based on higher level belief in rationality and the structure of the game are derived.

In certain finite extensive games with perfect information, Cristina Bicchieri (1989) derives a logical contradiction from the assumptions that players are rational and that they have common knowledge of the theory of the game. She argues that this may account for play outside the Nash equilibrium. She also claims that no inconsistency arises if the players have the minimal beliefs necessary to perform backward induction. We here show that another contradiction can be derived even with minimal beliefs, so (...) there is no paradox of common knowledge specifically. These inconsistencies do not make play outside Nash equilibrium plausible, but rather indicate that the epistemic specification must incorporate a system for belief revision. Whether rationality is common knowledge is not the issue. (shrink)

To determine what the speaker in a cooperative dialog meant with his assertion, on top of what he explicitly said, it is crucial that we assume that the assertion he gave was optimal. In determining optimal assertions we assume that dialogs are embedded in decision problems (van Rooij 2003) and use backwards induction for calculating them (Benz 2006). In this paper, we show that in terms of our framework we can account for several types of implicatures in a uniform way, (...) suggesting that there is no need for an independent linguistic theory of generalized implicatures. In the final section, we show how we can embed our theory in the framework of signaling games, and how it relates with other game theoretic analyses of implicatures. (shrink)

Edited by three leading figures in the field, this exciting volume presents cutting-edge work in decision theory by a distinguished international roster of contributors. These mostly unpublished papers address a host of crucial areas in the contemporary philosophical study of rationality and knowledge. Topics include causal versus evidential decision theory, game theory, backwards induction, bounded rationality, counterfactual reasoning in games and in general, analyses of the famous common knowledge assumptions in game theory, and evaluations (...) of the normal versus extensive form formulations of complex decision problems. (shrink)

In evolutionary models of indirect reciprocity, reputation mechanisms can stabilize cooperation even in severe cooperation problems like the prisoner’s dilemma. Under certain circumstances, conditionally cooperative strategies, which cooperate iff their partner has a good reputation, cannot be invaded by any other strategy that conditions behavior only on own and partner reputation. The first point of this paper is to show that an evolutionary version of backward induction can lead to a breakdown of this kind of indirectly reciprocal cooperation. Backward induction, (...) however, requires strategies that count and then cease to cooperate in the last, last but one, last but two, … game they play. These strategies are unlikely to exist in natural settings. We then present two new findings. (1) Surprisingly, the same kind of breakdown is also possible without counting. Strategies using rare golden opportunities for defection can invade conditional cooperators. This can create further golden opportunities, inviting the next wave of opportunists, and so on, until cooperation breaks down completely. (2) Cooperation can be stabilized against these opportunists, by letting an individual’s initial reputation be inherited from that individual’s parent. This ‘inclusive reputation’ mechanism can cope with any observably opportunistic strategy. Offspring of opportunists who successfully exploited a conditional cooperator cannot repeat their parents’ success because they inherit a bad reputation, which forewarns conditional cooperators in later generations. (shrink)

We locate winning strategies for various ${\mathrm{\Sigma }}_{3}^{0}$ -games in the L-hierarchy in order to prove the following: Theorem 1. KP+Σ₂-Comprehension $\vdash \exists \alpha L_{\alpha}\ models"\Sigma _{2}-{\bf KP}+\Sigma _{3}^{0}-\text{Determinacy}."$ Alternatively: ${\mathrm{\Pi }}_{3}^{1}\text{\hspace{0.17em}}-{\mathrm{C}\mathrm{A}}_{0}\phantom{\rule{0ex}{0ex}}$ "there is a β-model of ${\mathrm{\Delta }}_{3}^{1}-{\mathrm{C}\mathrm{A}}_{0}\text{\hspace{0.17em}}\text{\hspace{0.17em}}+\text{\hspace{0.17 em}}{\mathrm{\Sigma }}_{3}^{0}$ -Determinacy." The implication is not reversible. (The antecedent here may be replaced with ${\mathrm{\Pi }}_{3}^{1}\text{\hspace{0.17em}}\text{\hspace{0.17em}}\left({\mathrm{\Pi }}_{3}^{1}\right)-{\mathrm{C}\mathrm{A}}_{0}:\text{\hspace{0.17em}}{\mathrm{\Pi }}_{3}^{1}$ instances of Comprehension with only ${\mathrm{\Pi }}_{3}^{1}$ -lightface definable parameters—or even weaker theories.) Theorem 2. KP +Δ₂-Comprehension +Σ₂-Replacement + ${\mathrm{\Sigma }}_{3}^{0}\phantom{\rule{0ex}{0ex}}$ -Determinacy. (Here AQI (...) is the assertion that every arithmetical quasi-inductive definition converges.) Alternatively: $\Delta _{3}^{1}{\rm CA}_{0}+{\rm AQI}\nvdash \Sigma _{3}^{0}$ -Determinacy. Hence the theories: ${\mathrm{\Pi }}_{3}^{1}-{\mathrm{C}\mathrm{A}}_{0},\text{\hspace{0.17em}}{\mathrm{\Delta }}_{3}^{1}-{\mathrm{C}\mathrm{A}}_{0}+\text{\hspace{0.17em}}{\mathrm{\Sigma }}_{3}^{0}-\mathrm{D}\mathrm{e}\mathrm{t}\phantom{\rule{0ex}{0ex}}$ -Det, ${\mathrm{\Delta }}_{3}^{1}-{\mathrm{C}\mathrm{A}}_{0}+\mathrm{A}\mathrm{Q}\mathrm{I}$ , and ${\mathrm{\Delta }}_{3}^{1}-{\mathrm{C}\mathrm{A}}_{0}\phantom{\rule{0ex}{0ex}}$ are in strictly descending order of strength. (shrink)

Information protocols (IP's) were developed to describe players who learn their social situation by their experiences. Although IP's look similar to colored multi-graphs (MG's), the two objects are constructed in fundamentally different ways. IP's are constructed using the global concept of history, whereas graphs are constructed using the local concept of edges. We give necessary and sufficient conditions for each theory to be captured by the other. We find that the necessary and sufficient condition for IP theory to (...) be captured by MG theory, which we call SE, excludes relevant game situations. Hence, we conclude that IP theory remains a vital tool and cannot be replaced by MG theory. (shrink)

Lighten up about mathematics! Have fun. If you read this book, you will have to endure bad math puns and jokes and out-of-date pop culture references. You'll learn some really cool mathematics to boot. In the process, you will immerse yourself in living, thinking, and breathing logical reasoning. We like to call this proofs, which to some is a bogey word, but to us it is a boogie word. You will learn how to solve problems, real and imagined. After all, (...) math is a game where, although the rules are pretty much set, we are left to our imaginations to create. Think of this book as blueprints, but you are the architect of what structures you want to build. Make sure you lay a good foundation, for otherwise your buildings might fall down. To help you through this, we guide you to think and plan carefully. Our playground consists of basic math, with a loving emphasis on number theory. We will encounter the known and the unknown. Ancient and modern inquirers left us with elementary-sounding mathematical puzzles that are unsolved to this day. You will learn induction, logic, set theory, arithmetic, and algebra, and you may one day solve one of these puzzles. (shrink)

An important approach to game theory is to examine the consequences of beliefs that agents may have about each other. This paper investigates respect for public preferences. Consider an agent A who believes that B strictly prefers an option a to an option b. Then A respects B’s preference if A assigns probability 1 to the choice of a given that B chooses a or b. Respect for public preferences requires that if it is common belief that B (...) prefers a to b, then it is common belief that all other agents respect that preference. Along the lines of Blume, Brandenburger and Dekel [3] and Asheim [1], I treat respect for public preferences as a constraint on lexicographic probability systems. The main result is that given respect for public preferences and perfect recall, players choose in accordance with Iterated Backward Inference. Iterated Backward Inference is a procedure that generalizes standard backward induction reasoning for games of both perfect and imperfect information. From Asheim’s characterization of proper rationalizability [1] it follows that properly rationalizable strategies are consistent with respect for public preferences; hence strategies eliminated by Iterated Backward Inference are not properly rationalizable. (shrink)