Correlated Perfect Equilibrium
Theoretical Economics
2025-10-10 v1
Abstract
We propose a refinement of correlated equilibrium based on mediator errors, called correlated perfect equilibrium (CPE). In finite games, the set of CPE is nonempty and forms a finite union of convex sets. Like perfect equilibrium, a CPE never assigns positive probability to any weakly dominated strategy. We provide a dual representation of CPE and demonstrate how it differs from two existing refinements of correlated equilibrium--acceptable correlated equilibrium (Myerson, 1986) and perfect direct correlated equilibrium (Dhillon-Mertens, 1996)--through examples.
Keywords
Cite
@article{arxiv.2510.07906,
title = {Correlated Perfect Equilibrium},
author = {Wanying Huang and J. Jude Kline and Priscilla Man},
journal= {arXiv preprint arXiv:2510.07906},
year = {2025}
}