A partial-state space model of unawareness

TL;DR

This paper introduces a novel partial-state space model for unawareness, extending Aumann's knowledge framework by incorporating awareness operators and set-theoretic ideas, and demonstrates its theoretical robustness.

Contribution

It develops a new model of unawareness based on partial specifications and set theory, and proves a representation theorem linking abstract algebraic structures to this model.

Findings

The model can represent agents' unawareness using partial-state spaces.

A representation theorem connects algebraic structures with the partial-state space model.

Weakening an axiom allows escaping a known impossibility result.

Abstract

We propose a model of unawareness that remains close to the paradigm of Aumann's model for knowledge [R. J. Aumann, International Journal of Game Theory 28 (1999) 263-300]: just as Aumann uses a correspondence on a state space to define an agent's knowledge operator on events, we use a correspondence on a state space to define an agent's awareness operator on events. This is made possible by three ideas. First, like the model of [A. Heifetz, M. Meier, and B. Schipper, Journal of Economic Theory 130 (2006) 78-94], ours is based on a space of partial specifications of the world, partially ordered by a relation of further specification or refinement, and the idea that agents may be aware of some coarser-grained specifications while unaware of some finer-grained specifications; however, our model is based on a different implementation of this idea, related to forcing in set theory. Second, we depart from a tradition in the literature, initiated by [S. Modica and A. Rustichini, Theory and Decision 37 (1994) 107-124] and adopted by Heifetz et al. and [J. Li, Journal of Economic Theory 144 (2009) 977-993], of taking awareness to be definable in terms of knowledge. Third, we show that the negative conclusion of a well-known impossibility theorem concerning unawareness in [Dekel, Lipman, and Rustichini, Econometrica 66 (1998) 159-173] can be escaped by a slight weakening of a key axiom. Together these points demonstrate that a correspondence on a partial-state space is sufficient to model unawareness of events. Indeed, we prove a representation theorem showing that any abstract Boolean algebra equipped with awareness, knowledge, and belief operators satisfying some plausible axioms is representable as the algebra of events arising from a partial-state space with awareness, knowledge, and belief correspondences.