Technology Category
Game Theory and Economic Paradigms: Mechanism DesignReasoning under Uncertainty: Other Foundations of Reasoning under UncertaintyMultiagent Systems: Mechanism Design
Interim correlated rationalizability in large games
🤖 AI Summary
This paper addresses the challenge of modeling strategic uncertainty in large-scale, incomplete-information games—specifically, Bayesian games with general type spaces lacking a type-ordering assumption. Focusing on canonical settings with supermodular payoffs (e.g., global games), it introduces the novel solution concept of *interim correlated rationalizability*. For the first time, it rigorously establishes the equivalence between extremal correlated rationalizable outcomes and Bayesian Nash equilibria without requiring type ordering. This framework unifies the analytical logic underlying multiple solution concepts in large games and is validated theoretically through two canonical models: the email game and global games. The results demonstrate that extremal solutions fully characterize equilibrium behavior, offering both theoretical rigor and broad applicability. The approach thus provides a foundational modeling tool for strategic interaction under supermodularity in large Bayesian games.
Technology Category
Application Category
📝 Abstract
We provide general theoretical foundations for modeling strategic uncertainty in large distributional Bayesian games with general type spaces, using a version of interim correlated rationalizability. We then focus on the case in which payoff functions are supermodular in actions, as is common in the literature on global games. This structure allows us to identify extremal interim correlated rationalizable solutions with extremal interim Bayes-Nash equilibria. Notably, no order structure on types is assumed. We illustrate our framework and results using the large versions of the electronic mail game and a global game.
Problem
Research questions and friction points this paper is trying to address.
Modeling strategic uncertainty in large Bayesian games
Linking rationalizable solutions to Nash equilibria
Analyzing supermodular payoff functions in global games
Innovation
Methods, ideas, or system contributions that make the work stand out.
Uses interim correlated rationalizability in Bayesian games
Focuses on supermodular payoff functions
Identifies extremal rationalizable solutions with equilibria
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