| Article ID: | iaor20133801 |
| Volume: | 42 |
| Issue: | 3 |
| Start Page Number: | 567 |
| End Page Number: | 592 |
| Publication Date: | Aug 2013 |
| Journal: | International Journal of Game Theory |
| Authors: | Bonanno Giacomo |
| Keywords: | Bayesian analysis, Bayesian belief networks, network equilibrium |
We provide a general notion of perfect Bayesian equilibrium which can be applied to arbitrary extensive‐form games and is intermediate between subgame‐perfect equilibrium and sequential equilibrium. The essential ingredient of the proposed definition is the qualitative notion of AGM‐consistency, which has an epistemic justification based on the theory of belief revision introduced by Alchourrón, Gärdenfors and Makinson. AGM‐consistency is a generalization of the notion of consistency introduced by Kreps and Wilson as part of the definition of sequential equilibrium.