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Sequential Cursed Equilibrium

Shani Cohen1; Shengwu Li2

1 Hebrew University (email: ) · 2 Harvard University (email: )

American Economic Review 2026

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)

DOI
10.1257/aer.20230309
Volume
116 (3)
Pages
934-976
Language
en
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BibTeX
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