Wednesday, May 4, 2016

Incomplete vs. Imperfect Information

Incomplete and imperfect information are two important concepts in game theory. They are similar but have quite different meanings.

Under imperfect information, players are simply unaware of the actions chosen by other players. However, they know who the other players are, what their possible strategies/actions are, and the preferences/payoffs of these other players. For example, you may not be able to perfectly observe the actions chosen by the other players (imperfect monitoring), or the implemented actions of other players may be different from their intentions.

Under incomplete information, players may or may not know some information about the other players, e.g. their “type”, their strategies, payoffs etc.