Axioms for Correlated Equilibrium

2026-07-07

AI Summary

This work provides an axiomatic characterization of correlated equilibrium and coarse correlated equilibrium in finite normal-form games from a behavioral perspective. Treating correlated strategies as action recommendations, the paper introduces three axioms of behavioral rationality: (i) never recommending strictly dominated actions, (ii) interchangeability of payoff-equivalent actions, and (iii) adherence to the sure-thing principle under both payoff and mechanism uncertainty. For the first time, this study establishes a uniqueness result grounded in behavioral rationality and informational uncertainty, proving that correlated equilibrium is the unique solution concept satisfying this axiom system. A parallel axiomatic characterization is also developed for coarse correlated equilibrium, thereby offering a unified foundational framework for both equilibrium notions.

Abstract

We characterize correlated equilibrium in finite normal-form games. Interpreting correlated strategies as action recommendations, we show that correlated equilibrium is the unique solution concept that never recommends a pure-strategy dominated action, treats payoff-equivalent actions interchangeably, and respects the sure-thing principle under uncertainty about payoffs and the correlation device. A parallel characterization identifies coarse correlated equilibrium among solution concepts that recommend dominant actions whenever they exist and treat payoff-equivalent actions as strongly interchangeable.

Problem

• correlated equilibrium
• coarse correlated equilibrium
• axiomatization
• normal-form games
• solution concept

Innovation

• correlated equilibrium
• axiomatic characterization
• sure-thing principle
• coarse correlated equilibrium
• dominance