Unawareness and partitional information structures

Salvatore Modica, Aldo Rustichini

Research output: Contribution to journalArticlepeer-review

101 Scopus citations

Abstract

We claim first that simple uncertainty is not an adequate model of a subject's ignorance, because a major component of it is the inability to give a complete description of the states of the world, and we provide a formal model of unawareness. In Modica and Rustichini (1994) we showed a difficulty in the project, namely that without weakening of the inference rules of the logic one would face the unpleasant alternative between full awareness and full unawareness. In this paper we study a logical system where non full awareness is possible, and prove that a satisfactory solution to the problem can be found by introducing limited reasoning ability of the subject. A determination theorem for this system is proved, and the appearance of partitional informational structures with unawareness is analysed.Journal of Economic Literature Classification Numbers: D80, D83.

Original languageEnglish (US)
Pages (from-to)265-298
Number of pages34
JournalGames and Economic Behavior
Volume27
Issue number2
DOIs
StatePublished - May 1999
Externally publishedYes

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