Simple Unawareness in Dynamic Psychological Games

Carsten S. Nielsen, Alexander Sebald

Research output: Contribution to journalJournal articleResearchpeer-review


Building on Battigalli and Dufwenberg (2009)’s framework of dynamic psychological games and the progress in the modeling of dynamic unawareness by Heifetz, Meier, and Schipper (2013a) we model and analyze the impact of asymmetric awareness in the strategic interaction of players motivated by reciprocity and guilt. Specifically we characterize extensive-form games with psychological payoffs and simple unawareness, define extensive-form rationalizability and, using this, show that unawareness has a pervasive impact on the strategic interaction of psychologically motivated players. Intuitively, unawareness influences players’ beliefs concerning, for example, the intentions and expectations of others which in turn impacts their behavior.
Original languageEnglish
Article number20150011
JournalThe B.E. Journal of Theoretical Economics
Issue number1
Pages (from-to)1-29
Number of pages29
Publication statusPublished - Jan 2017
Externally publishedYes


  • Unawareness
  • Psychological payoffs
  • Extensive-form rationalizability

Cite this