We consider the connections between belief revision, conditional logic and
nonmonotonic reasoning, using as a foundation the approach to theory
change developed by Alchourrón, Gärdenfors and Makinson (the AGM
approach). This is first generalized to allow the iteration of theory change
operations to capture the dynamics of epistemic states according to a
principle of minimal change of entrenchment. The iterative operations of
expansion, contraction and revision are characterized both by a set of
postulates and by Grove's construction based on total pre-orders on the set
of complete theories of the belief logic. We present a sound and complete
conditional logic whose semantics is based on our iterative revision
operation, but which avoids Gärdenfors's triviality result because of a
severely restricted language of beliefs and hence the weakened scope of our
extended postulates. In the second part of the paper, we develop a
computational approach to theory dynamics using Rott's E-bases as a
representation for epistemic states. Under this approach, a ranked E-base is
interpreted as standing for the most conservative entrenchment compatible
with the base, reflecting a kind of foundationalism in the acceptance of
evidence for a belief. Algorithms for the computation of our iterative
versions of expansion, contraction and revision are presented. Finally, we
consider the relationship between nonmonotonic reasoning and both
conditional logic and belief revision. Adapting the approach of Delgrande,
we show that the unique extension of a default theory expressed in our
conditional logic of belief revision corresponds to the most conservative
belief state which respects the theory: however, this correspondence is
limited to propositional default theories. Considering first order default
theories, we present a belief revision algorithm which incorporates the
assumption of independence of default instances and propose the use of a
base logic for default reasoning which incorporates uniqueness of names.
We conclude with an examination of the behavior of an implemented
system on some of Lifschitz's benchmark problems in nonmonotonic
reasoning.