An extensive game as a guide for solving a normal game

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Abstract

We show that for solvable games, the calculation of the strategies which survive iterative elimination of dominated strategies in normal games is equivalent to the calculation of the backward induction outcome of some extensive game. However, whereas the normal game form does not provide information on how to carry out the elimination, the corresponding extensive game does. As a by-product, we conclude that implementation using a subgame perfect equilibrium of an extensive game with perfect information is equivalent to implementation through a solution concept which we call guided iteratively elimination of dominated strategies which requires a uniform order of elimination. Journal of Economic Literature Classification Number: C72.

Original languageEnglish
Pages (from-to)32-42
Number of pages11
JournalJournal of Economic Theory
Volume70
Issue number1
DOIs
StatePublished - Jul 1996

Funding

FundersFunder number
Israel Institute of Business Research
United States - Israel Binational Agricultural Research and Development Fund1011-341

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