A theory of deception

Jehiel, Philippe; Ettinger, David

Jehiel, Philippe; Ettinger, David (2010), A theory of deception, American economic journal : Microeconomics, 2, 1, p. 1-20. http://dx.doi.org/10.1257/mic.2.1.1

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Type

Article accepté pour publication ou publié

Date

2010

Journal name

American economic journal : Microeconomics

Volume

Number

Publisher

American Economic Association

Pages

1-20

Abstract (EN)

This paper proposes an equilibrium approach to belief manipulation and deception in which agents only have coarse knowledge of their opponent's strategy. Equilibrium requires the coarse knowledge available to agents to be correct, and the inferences and optimizations to be made on the basis of the simplest theories compatible with the available knowledge. The approach can be viewed as formalizing into a game theoretic setting a well documented bias in social psychology, the fundamental attribution error. It is applied to a bargaining problem, thereby revealing a deceptive tactic that is hard to explain in the full rationality paradigm.

Subjects / Keywords

belief manipulation; deception; Bargaining Theory

JEL

C78 - Bargaining Theory; Matching Theory
D83 - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
D84 - Expectations; Speculations