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Sequential Cursed Equilibrium

Shani Cohen; Shengwu Li
American Economic Review 2026 116(3), 934-976
We propose an extensive-form solution concept, with players who neglect information from hypothetical events but make inferences from observed events. Our concept modifies cursed equilibrium (Eyster and Rabin 2005) and allows that players can be cursed about endogenous information. (JEL C73, D44, D71, D81, D83, D91)