In this module, we address games with both simultaneous and sequential elements, defining imperfect information and introducing information sets. We extend our understanding of strategies to accommodate imperfect information scenarios.
Key topics include:
Students will learn how to navigate strategic interactions with incomplete information and develop refined equilibrium concepts.
This module serves as an engaging introduction to the fundamentals of Game Theory. We kick off with a hands-on game experience, outlining the roles of players, their strategic choices, and each player's goals or payoffs.
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This module underscores the essence of strategic thinking, emphasizing the need to anticipate others' moves based on their payoffs.
In this module, we delve deeper into the formal elements of a game, including players, strategies, and payoffs. By revisiting themes from the previous session, we emphasize the significance of avoiding dominated strategies and the importance of empathy in strategic thinking.
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This module applies the concept of iterative deletion of dominated strategies to political elections, examining how candidates choose their policy positions. We critically assess the classic electoral models and their relevance to real-world political processes.
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By the end, students will understand how beliefs inform strategic choices and the implications for electoral outcomes.
This module continues with the analysis of best response strategies, focusing on how these concepts apply to soccer penalties and business partnerships. We emphasize that players should select strategies that are best responses to their beliefs about others' actions.
Key concepts include:
Students will learn how to identify best responses and understand the relevance of Nash Equilibrium in various strategic contexts.
This module formally defines Nash Equilibrium, a cornerstone of Game Theory. The discussion will cover why understanding Nash Equilibrium is crucial and how to identify it in various game scenarios.
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Students will leave with a solid grasp of Nash Equilibrium's role in strategic interactions.
In this module, we apply Nash Equilibrium to coordination games, specifically focusing on the Battle of the Sexes. We then explore the classic Cournot model, which examines competition between firms and the challenges of collusion.
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Students will gain insights into firm competition and strategic decision-making in imperfect markets.
Building on previous concepts, this module explores the Bertrand model of competition where firms set prices instead of quantities. We will analyze various scenarios involving firms and consumers on a linear market.
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Students will learn about strategic positioning in competitive environments and the dynamics of political competition.
This module investigates evolutionary stability, focusing on social conventions and aggressive versus passive strategies. We explore how these concepts can help predict behavioral variations in different contexts.
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Students will understand the relationship between evolutionary concepts and game theory, including stability in strategic interactions.
This module continues the exploration of mixed strategies, focusing on their implications in various contexts, including tennis. We dissect the payoff dynamics associated with mixed strategies and their equilibrium properties.
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Students will learn about the strategic advantages of employing mixed strategies in competitive scenarios.
This module further develops the concept of mixed strategies, applying them to diverse contexts, including sports, anti-terrorism, dating, and tax compliance. We analyze how mixed strategies can represent beliefs and proportions of choices.
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Students will appreciate the multifaceted nature of mixed strategies in strategic decision-making across different fields.
In this module, we revisit the candidate-voter model to analyze equilibrium characteristics and the implications of location choice in competitive settings. We also study Schelling's location game and its relevance to societal segregation.
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Students will learn how seemingly minor model details can significantly impact societal outcomes through strategic interactions.
This module discusses the interplay between game theory and evolutionary concepts, specifically focusing on what strategies are evolutionarily stable. We will connect concepts like domination and Nash equilibrium to biological principles.
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Students will gain a comprehensive perspective on how evolutionary concepts can inform economic and strategic analysis.
This module tackles sequential games, focusing on scenarios where players move one after another. We introduce the concept of backward induction, using the example of a borrower-lender relationship to highlight moral hazard issues.
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Students will learn effective strategies to mitigate moral hazard in sequential interactions, emphasizing the role of commitment.
Continuing with backward induction, this module analyzes quantity competition in sequential settings. We explore the Stackelberg model and discuss the nuances of first-mover advantages in various game contexts.
Key discussions include:
Students will grasp the complexities of sequential decision-making and the role of information in shaping outcomes.
This module further investigates backward induction concepts through the lens of games like chess and tic-tac-toe, emphasizing perfect information and strategy formulation. We analyze how some Nash equilibria may contradict backward induction.
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Students will learn about the importance of credibility in strategic threats and how it influences game outcomes.
This module explores the concept of reputation within game theory, focusing on situations where threats may lack credibility. We will analyze strategic choices in duel scenarios, emphasizing timing decisions and their implications.
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Students will appreciate the strategic complexities of reputation in competitive environments and how it shapes player behavior.
This module focuses on bargaining scenarios, starting from the ultimatum game and progressing to alternating offers. We will highlight the importance of discounting in bargaining outcomes and analyze power dynamics in negotiation.
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Students will learn how bargaining strategies can shape outcomes in competitive negotiations and the factors that influence them.
In this module, we address games with both simultaneous and sequential elements, defining imperfect information and introducing information sets. We extend our understanding of strategies to accommodate imperfect information scenarios.
Key topics include:
Students will learn how to navigate strategic interactions with incomplete information and develop refined equilibrium concepts.
This module analyzes subgame perfect equilibrium (SPE) through various practical games, emphasizing the importance of backward induction and credibility. We explore multiple equilibria and their implications for strategic decision-making.
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Students will gain insights into the complexity of SPE and its relevance across different strategic contexts.
This module examines wars of attrition, which are characterized by prolonged competitive struggles in various contexts, from business to military engagements. We analyze the underlying dynamics that can lead to costly conflicts.
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Students will learn about the strategic implications of attrition models and how to navigate potential conflicts effectively.
This module discusses the dynamics of repeated games, focusing on how promises and threats can create incentives for good behavior over time. We analyze the conditions under which these strategies are credible and effective.
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Students will learn how to implement strategies that sustain cooperation in repeated scenarios through credible commitments and incentives.
This module continues the discussion on repeated games, emphasizing how the structure of these games affects cooperation. We explore how the end game scenario can unravel incentives and hinder collaboration.
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Students will grasp the complexities of maintaining cooperation in repeated interactions, especially as potential end games approach.
This module delves into the concept of asymmetric information, where one party possesses knowledge that the other does not. We will explore two specific scenarios:
Additionally, we will critically evaluate the implications of these concepts on the education system, suggesting a rather pessimistic view of its role in signaling competence.
This module focuses on the dynamics of auctions, distinguishing between common and private value scenarios. Key topics include:
Lastly, although we will touch upon which auction types maximize seller revenues, a detailed analysis will be reserved for future courses.