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Published February 8, 2022 | Updated
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Cognitive Hierarchies in Extensive Form Games


The cognitive hierarchy (CH) approach posits that players in a game are heterogeneous with respect to levels of strategic sophistication. A level-k player believes all other players in the game have lower levels of sophistication distributed from 0 to k-1, and these beliefs correspond to the truncated distribution of a "true" distribution of levels. We extend the CH framework to extensive form games, where these initial beliefs over lower levels are updated as the history of play in the game unfolds, providing information to players about other players' levels of sophistication. For a class of centipede games with a linearly increasing pie, we fully characterize the dynamic CH solution and show that it leads to the game terminating earlier than in the static CH solution for the centipede game in reduced normal form.

Additional Information

We thank Colin F. Camerer, Jean-Laurent Rosenthal, Joseph Tao-yi Wang and audiences at the 2021 ESA North American Conference and the 2022 SAET Conference for their valuable comments.

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Updated - sswp1460_updated_081022.pdf


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August 20, 2023
January 15, 2024