In order to get started, so that the failure of anybody to leave is meaningful, all this must be known. And, for Michael solution to work, all this must be known too. Only a truth telling guru communicating to everyone that indeed there is a blue can cut through this recursive epistemic conundrum. — hypericin
I'm not convinced that it need be recursive. It's sufficient that each person knows that each person knows that green sees blue.
If we assume that the participants are numbered, each participant asks himself "is there some X and Y such that
#X does not know that
#Y knows that #101 sees blue?".
Given that there are 201 participants, there are 40,401 possible combinations, so it's unfeasible for us to list them all, although our perfect logicians will be able to.
But we can make a start.
I'm #1 and I see 99 blue (#2-100), 1 green (#101), and 100 brown (#102-#201).
I ask myself:
Does #2 know that #101 sees blue? Yes; #2 knows that #101 can see blue #3.
Does #2 know that #1 knows that #101 sees blue? Yes; #2 knows that #1 and #101 both see blue #3.
Does #2 know that #2 knows that #101 sees blue? Yes; #2 knowing what #2 knows is a tautology.
Does #2 know that #3 knows that #101 sees blue? Yes; #2 knows that #3 and #101 both see blue #4.
Does #2 know that #4 knows that #101 sees blue? Yes; #2 knows that #4 and #101 both see blue #3.
Does #2 know that #5 knows that #101 sees blue? Yes; #2 knows that #5 and #101 both see blue #3.
Does #2 know that #6 knows that #101 sees blue? Yes; #2 knows that #6 and #101 both see blue #3.
...
I'm fairly certain the answer is always going to be "Yes", and so that there is no X and Y such that
#X does not know that
#Y knows that #101 sees blue.
So, returning back to the previous steps, I deduce that (1) is true, and can make use of the subsequent counterfactuals to determine whether or not I am blue, which I will deduce on either the 99th day (if I'm not) or the 100th day (if I am):
1. As of right now everyone has come to know, through some means or another, that everyone knows that #101 sees blue
2. If (1) is true and if I do not see blue then I am blue and will leave this evening
3. If (1) is true and if I see 1 blue then if he does not leave this evening then I am blue and will leave tomorrow evening
4. If (1) is true and if I see 2 blue then ...
...
And it bears repeating (if any reader missed the previous comment), that even though as a practical matter (1) is true in counterfactual scenarios (2) and (3) only if someone says "I see blue" isn't that someone must say "I see blue" in every counterfactual and actual scenario for (1) to be true and for this reasoning to be usable.