The purpose of this paper is twofold. First, we generalize Kajii et al. (J Math Econ 43:218–230, <CitationRef CitationID="CR16">2007</CitationRef>) and provide a condition under which for a game <InlineEquation ID="IEq1"> <EquationSource Format="TEX">$$v$$</EquationSource> <EquationSource Format="MATHML"> <math xmlns:xlink="http://www.w3.org/1999/xlink"> <mi>v</mi> </math> </EquationSource> </InlineEquation>, its Möbius inverse is equal to zero within the framework of the <InlineEquation ID="IEq2"> <EquationSource Format="TEX">$$k$$</EquationSource> <EquationSource Format="MATHML"> <math xmlns:xlink="http://www.w3.org/1999/xlink"> <mi>k</mi> </math> </EquationSource> </InlineEquation>-modularity of <InlineEquation ID="IEq3"> <EquationSource Format="TEX">$$v$$</EquationSource> <EquationSource Format="MATHML"> <math xmlns:xlink="http://www.w3.org/1999/xlink"> <mi>v</mi> </math> </EquationSource> </InlineEquation> for <InlineEquation ID="IEq4"> <EquationSource Format="TEX">$$k \ge 2$$</EquationSource> <EquationSource Format="MATHML"> <math xmlns:xlink="http://www.w3.org/1999/xlink"> <mrow> <mi>k</mi>...</mo></mrow></math></equationsource></equationsource></inlineequation></equationsource></equationsource></inlineequation></equationsource></equationsource></inlineequation></equationsource></equationsource></inlineequation></citationref>

Using a simple framework of Cooper and John (1988) and Cooper (1999), this paper derives the conditions under which overconfidence and underconfidence of agents lead to Pareto improvement. We show that an agent’s overconfidence in a game exhibiting strategic complementarity and positive...

Using a simple framework due to Cooper and John (1988) and Cooper (1999), this paper derives the conditions under which overconfidence and underconfidence of agents lead to Pareto improvement. We show that an agent's overconfidence in a game exhibiting strategic complementarity and positive...

This paper studies the effects of Knightian uncertainty, or ambiguity, on entrepreneurial choice. By distinguishing between risk and ambiguity, we first show that ambiguity aversion makes it less likely that an individual will become an entrepreneur. It is also shown that an increase in...