backward induction
noun1
Computing, Engineering, Game theory, Mathematics, Natural sciences, Physical sciences, Sciences Usually The process of reasoning backwards in time, from the end of a problem or situation, to determine a sequence of optimal actions.
- Simple game theory tells us that a process of backward induction should, really, at some point, induce the smart money to get out. And were that to happen, investors really should be prepared to lose everything.2021 December 14, Richard Partington, quoting Thomas Belsham, “Bitcoin could become ‘worthless’, Bank of England warns”, in The Guardian:
- Related terms
- decision tree