Admissibility and Event-Rationality∗

We develop an approach to providing epistemic conditions for admissible behavior in games. Instead of using lexicographic beliefs to capture infinitely less likely con-jectures, we postulate that players use tie-breaking sets to help decide among strate-gies that are outcome-equivalent given their conjectures. A player is event-rational if she best responds to a conjecture and uses a list of subsets of the other players’ strategies to break ties among outcome-equivalent strategies. Using type spaces to capture interactive beliefs, we show that common belief of event-rationality (RCBER) implies that players play strategies in S∞W, that is, admissible strategies that also survive iterated elimination of dominated strategies (Dekel and Fudenberg (1990)). We strengthen standard belief to validated belief and we show that event-rationality and common validated belief of event-rationality (RCvBER) implies that players play it-erated admissible strategies (IA). We show that in complete, continuous and compact type structures, RCBER and RCvBER are nonempty, and hence we obtain epistemic criteria for S∞W and IA