Notes from the Logical Induction paper as I walk through the construction of LIA in section 5.
Lemma 5.1.1 (Fixed Point Lemma)
"Observe that
is equal to the natural inclusion of the finite-dimensional cube
in the space of all valuations
." -- I think what this is saying is that since
, we can think of
as being sort of a subset of
. Except it's not strictly speaking a subset, since the functions in
and
have different domains. How can we make it a subset? The "natural" way to do this is to set everything outside of
to zero. But that's exactly what
is. One thing I'm still not sure about is the "finite-dimensional" part; doesn't having
make the cube infinite-dimensional?
Definition of fix: I found it helpful to look at the graph of
; this looks like the identity function in the interval
, but then becomes constant once it hits either of the endpoints. If you've already thought about the definition of continuous threshold indicator (definition 4.3.2), then you will recognize that
.
"the compact, convex space
" -- this intuitively makes sense, since
basically "looks like" a cube. But I'm not sure how to verify this.
The following is used in the Fixed Point Lemma (5.1.1):
Writing the
-strategy as

we have

But
so the two sums cancel to obtain
.
Definition/Proposition 5.1.2 (MarketMaker)
Lemma 5.1.3 (MarketMaker Inexploitability)
Definition/Proposition 5.2.1 (Budgeter)
Lemma 5.2.2 (Properties of Budgeter)
Proposition 5.3.1 (Redundant Enumeration of e.c. Traders)
Definition/Proposition 5.3.2 (TradingFirm)
Lemma 5.3.3 (Trading Firm Dominance)
See also