Hands-On Microeconomics: a primer in Game Theory.

Description

This course introduces the main concepts of non cooperative game theory by using a hands-on approach, i.e. by presenting, discussing and solving examples.

Some well known normal form games, such as matching pennies, the prisoners' dilemma, the battle of sexes, and the game of chicken, will be discussed to introduce and apply concepts like Nash equilibrium in pure and mixed strategies, the elimination of dominated strategies, and repeated games.

Sequential games will also be described, by using an extensive form based on game trees. The notion of subgame perfect equilibrium will consequently be discussed.

Finally, some game tehoretical concepts will be used to describe the outcome of Cournot and Stackelberg duopoly, and the instability of a cartel.

What You Will Learn!

• Students will learn the main concepts in non cooperative game theory, and will learn how to use them to find equilibria for actual games.
• Students will get to know very well some battle horse games, such as matching pennies, the prisoners' dilemma, the battle of sexes and the game of chicken.
• Students will learn to use equilibrium concepts such as that of Nash equilibrium, and that of subgame perfect equilibrium for sequential games.
• Students will be taken to make comparisons between game theoretic concepts and some market forms.
• Students will be asked to apply the concepts learned in class to some end of class exercises.

Who Should Attend!

• First and second year students in Economics (Major and Minor).
• Students in social sciences, wishing to get basic hands-on notions of non coopeerative Game Theory.
• Managers wishing to get some insight into game theoretical concepts, and learn to think more strategically.

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