An Impossibility Theorem on Beliefs in Games
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A paradox of self-reference in beliefs in games is identified, which yields a game-theoretic impossibility theorem akin to Russell’s Paradox. An informal version of the paradox is that the following configuration of beliefs is impossible:
Ann believes that Bob assumes that
Ann believes that Bob’s assumption is wrong
This is formalized to show that any belief model of a certain kind must have a ‘hole.’ An interpretation of the result is that if the analyst’s tools are available to the players in a game, then there are statements that the players can think about but cannot assume. Connections are made to some questions in the foundations of game theory.
Keywordsbelief model complete belief model game first order logic modal logic paradox
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