Stability and efficiency in perfect foresight situation

We study the stable standard of behavior in a perfect foresight situation that was introduced by Xue (Econ Theory 11:603–627, <CitationRef CitationID="CR31">1998</CitationRef>). We assume that the inducement relations are invertible and coalition free. We show that the conditions are sufficient for the existence of the nonempty-valued optimistic/conservative stable standard of behavior for perfect foresight situation (OSSB-PF/CSSB-PF). Moreover, we find that an OSSB-PF supports a Pareto-efficient outcome as a stable outcome; if the preference relations are strict, only the Pareto-efficient outcomes are supported by the OSSB-PF. Copyright Springer Science+Business Media New York 2013