Anthony Kelly, Decision making using Game Theory, Cambridge UP, 2003.
Slides.
Other material.
URL: http://www.economiamc.org/debenedictis
Objectives
Emphasizing the role of competition and cooperation in different situations in which agents take decisions
To learn how to represent those processes and how to formalize choices
Outline
History of game theory
Cooperative games
Non cooperative games
Oligopoly theory and applications
Games with asymmetric information
Repited games
Games with incomplete information
Definition
Game theory is the study of formal models (mathematical schemes) of conflict and cooperation among agents that are rational and intelligent.
Rational: every agent maximizes her objective function (expected utility, profits, …)
Intelligent: all agents know that they interact with other agents which are rational an intelligent
Strategic interaction
What is a game?
Tre giocatori (agenti) scelgono simultaneamente un numero tra [0,1]
Vince chi sceglie il numero più vicino alla media dei tre numeri
In caso di parità la vincita si divide equamente
Elements of a game
Number of players i N = {1,...,n}
Strategies si Si
Vector of strategies s = (s1,...,sn) S = S1...Sn
Payoff ui(s):S,
Game in strategic form (normal) d , d l , w d , d w , l Left Right Left Right Player 2 Player 1 = {S1,...,Sn;u1,...,un}
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