Game Theory Breakthrough: Rationality and Equilibrium Concepts Unified, Transforming Strategic Interactions
The article discusses how players in games make decisions based on their rationality. It shows that when players believe others act independently, they reach a certain type of equilibrium. This equilibrium is called independent rationalizability. The research also reveals that when players have common knowledge of rationality, they reach another type of equilibrium called correlated rationalizability. These findings provide a deeper understanding of how players make decisions in games and justify the equilibrium approach in game theory.