The epistemic program in game theory uses formal models of interactive reasoning to provide foundations for various game-theoretic solution concepts. Much of this work is based around the (static) Aumann structure model of interactive epistemology, but more recently dynamic models of interactive reasoning have been developed, most notably by Stalnaker [Econ. Philos. 12 (1996) 133-163] and Battigalli and Siniscalchi [J. Econ. Theory 88 (1999) 188-230], and used to analyze rational play in extensive form games. But while the properties of Aumann structures are well understood, without a formal language in which belief and belief revision statements can be expressed, it is unclear exactly what are the properties of these dynamic models. Here we investigate this question by defining such a language. A semantics and syntax are presented, with soundness and completeness theorems linking the two.

There are many laws that require sellers to disclose private information about the quality of their products. But the theoretical justification for these laws is not obvious: economic theory predicts that a seller will voluntarily disclose such quality information, however unfavorable, as long as it is costless to do so. Here we show that competitive pressures between firms can undermine this full disclosure result, and explain why it may be the case that only high‐quality firms choose to disclose. In this setting, mandatory disclosure laws can promote competition and raise consumer surplus at the expense of firm profits, potentially increasing the efficiency of the market.

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The institution of judicial review is an important mechanism of holding the government legally accountable, nevertheless questions remain about its proper role in a separation of powers system. This article analyzes the effect of judicial review on the policy-making process from an expertise perspective. It shows that the exercise of non-expert judicial review can induce more informed policies and that non-expert courts have incentives to exercise judicial review in a manner consistent with institutional concerns for expertise. In addition to its importance as a mechanism of legal accountability, our analysis underscores another virtue of judicial review: legal review of governmental policy by non-expert courts can improve the amount of information available for policy making. The article contributes to a literature on the scope and legitimacy of judicial review and has broader implications for understanding the effect of institutional checks and balances on the quality of policy making.