Tesfatsion, Leigh

Applied Mathematics and Computation Vol. 6 (1980): 51-61.

In the absence of contrary information, it would seem prudent for competitors to attribute to their opposition the same level of rationality they attribute to themselves. Using a simple but interesting C^3 (command, control, and communication) problem for illustration, a method is proposed for incorporating symmetrical rationality without resorting to the general multistage game framework which has proved difficult to apply in practice. A "criterion filtering" technique is then proposed for the approximate solution of the resulting model which does not require integration operations and which appears to be especially well suited for C^3 problems with finite admissible control sets. Annotated pointers to related work can be accessed here: http://www.econ.iastate.edu/tesfatsi/cfhome.htm

JEL Classification: C6, C7

Keywords: N-person game, symmetrical rationality, criterion filtering, Command, control, communication