A Note on Cursed Sequential Equilibrium and Sequential Cursed Equilibrium
In this short note, we compare the cursed sequential equilibrium (CSE) by Fong et al. (2023) and the sequential cursed equilibrium (SCE) by Cohen and Li (2023). We identify eight main differences between CSE and SCE with respect to the following features: (1) the family of applicable games, (2) the number of free parameters, (3) the belief updating process, (4) the treatment of public histories, (5) effects in games of complete information, (6) violations of subgame perfection and sequential rationality, (7) re-labeling of actions, and (8) effects in one-stage simultaneous-move games.
We are grateful to Shengwu Li and Shani Cohen for multiple email correspondences in December 2022 that helped to clarify some of the differences between the CSE and SCE approaches to the generalization of cursed equilibrium for dynamic games. An initial version of the SCE working paper was posted on December 13, 2022, and this note is written based on the third version, Cohen and Li (2023), dated February 27, 2023.
Accepted Version - sswp1467.pdf