Mutual Knowledge
Mutual knowledge in game theory is information known by all participatory agents. However, unlike common knowledge, a related topic, mutual knowledge does not require that all agents are aware that this knowledge is mutual. All common knowledge is mutual knowledge, but not all mutual knowledge is common knowledge. Mutual knowledge can arise accidentally, due to a failure to design the game properly, so all players independently discover this mutual knowledge, or deliberately, due to the expected course of the game. The difference between mutual knowledge and common knowledge The difference is crucial in a co-operation game. For example, in the game depicted below, with a random event determining the payoff matrix, both players, being fully rational Rationality is the quality of being guided by or based on reasons. In this regard, a person acts rationally if they have a good reason for what they do or a belief is rational if it is based on strong evidence. This quality can a ...
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Game Theory
Game theory is the study of mathematical models of strategic interactions among rational agents. Myerson, Roger B. (1991). ''Game Theory: Analysis of Conflict,'' Harvard University Press, p.&nbs1 Chapter-preview links, ppvii–xi It has applications in all fields of social science, as well as in logic, systems science and computer science. Originally, it addressed two-person zero-sum games, in which each participant's gains or losses are exactly balanced by those of other participants. In the 21st century, game theory applies to a wide range of behavioral relations; it is now an umbrella term for the science of logical decision making in humans, animals, a