"This innovative textbook introduces students to the rudimentary principles of game theory - move and countermove - with an emphasis on real-world business and economic applications. Students with a background in principles of economics and business mathematics will find the material in this text comprehensive and accommodating." "Demonstration Problems throughout each chapter are designed to enhance the student's understanding of the concepts presented. Many chapters include nontechnical applications designed to further the student's intuitive understanding of strategic behavior. Case Studies help underscore the usefulness of game theory for analyzing real-world situations. Each chapter concludes with a Review, as well as Questions and Exercises. An online Instructor's Manual with test bank is available to professors who adopt this text."--BOOK JACKET.

Thomas J. Webster is a professor in the Department of Finance and Economics of the Lubin School of Business at Pace University in New York City.

List of Figures and Tables
Acknowledgments
A Note to Students and Instructors
Introduction to Game Theory
Introduction
A Short History of Game Theory
Strategic Behavior
Glaxo and Zantac
What is Game Theory?
The Prisoner's Dilemma
Shortcut for Finding Pure Strategy Nash Equilibria
Chapter Review
Chapter Questions
Chapter Exercises
Mathematics Review
Noncooperative, One-time, Static Games with Complete Information
Introduction
Strictly-Dominant Strategies
Run With the Pitch
Indiana Jones and the Last Crusade
The Good, the Bad and the Ugly
Nash Equilibrium
Strictly-dominant Strategy Equilibrium
Weakly-dominant Strategies
Iterated Elimination of Strictly-Dominated Strategies
Three-Player Games
Non-Dominant Strategies
A Beautiful Mind
Maximin Decision Rule
Minimax Regret Decision Rule
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Focal-Point and Evolutionary Equilibria
Introduction
Multiple Nash Equilibria
Focal-Point Equilibrium
Developing a Theory of Focal Point Equilibria Framing
AZT versus Videx
Evolutionary Game Theory
Evolutionary Equilibrium in Broadband Technology?
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Infinitely-Repeated, Static Games with Complete Information
Introduction
Extra Credit Game Part I
Collusion
Prisoner's Dilemma Revisited
Trigger Strategies
Evaluating Payoffs in Infinitely-Repeated Games
Cheating Rule for Infinitely-Repeated Games
Making Threats Credible
The Hunt for Red October
Fail-Safe
Determinants of Business Collusion
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Finitely-Repeated, Static Games with Complete Information
Introduction
Finitely-Repeated Games with a Certain End
End-of-Game Problem
Extra Credit Game Part II
Finitely-Repeated Games with an Uncertain End
Groundhog Day
Cheating Rule for Finitely-Repeated Games with an Uncertain End
Common Enforcement Mechanisms
Philip Morris versus BAT
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Mixing Pure Strategies
Introduction
Zero-Sum Games
Minimax Theorem
Mixed Strategies
Optimal Mixing Rules
Computing Optimal Mixing rules
When to Use Optimal Mixing Rules
Randomizing Pure Strategies
Bluffing
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Static Games with Continuous Strategies
Introduction
Continuous Strategies
Reaction (Best Response) Functions
Tragedy of the Commons
The Coase Theorem
The Global Carbon Tax
Shifting Reaction Functions
Chapter Review
Chapter Questions
Chapter Exercises
Imperfect Competition
Introduction
Market Structure
Oligopoly
Models of Oligopoly
Cournot-Nash Equilibrium in the Corn Wet Milling Industry
The OPEC Price-Fixing Cartel
Blood Diamonds
Chapter Review
Chapter Questions
Chapter Exercises
Perfect Competition and Monopoly
Introduction
Standard Model of Perfect Competition
Perfect Competition and Game Theory
Perfect Competition and the Cournot Model
How Many Firms are Necessary for Perfect Competition?
Standard Model of Monopoly
Sources of Monopoly Power
Monopoly and Game Theory
Contestable Monopoly
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Strategic Trade Policy
Introduction
Boeing versus Airbus
Strategic Trade Policy with Discrete Pure Strategies
Strategic Trade Policy with Continuous Pure Strategies
National Welfare
Intraindustry Trade
Imperfect Competition in International Trade
To Trade or Not to Trade?
Export Subsidies
Reciprocity
U S -Japan Voluntary Export Restraints
Increasing Returns to Scale
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Dynamic Games with Complete and Perfect Information
Introduction
Game Trees
Sun Country versus Northwest Airlines
Subgame Perfect Equilibrium
Backward Induction
Simplifying the Notation
First-Mover Advantage
Leader of the Pack
Credible Threats
Dynamic Games with Continuous Strategies
The Stackelberg Model
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Bargaining
Introduction
Nash Bargaining
Dynamic Bargaining and the Last-Mover's Advantage
Dynamic Bargaining With Symmetric Impatience
Dynamic Bargaining With Asymmetric Impatience
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Pure Strategies with Uncertain Payoffs
Introduction
Static Games with Uncertain Payoffs
Risk and Uncertainty
Global Warming: Uncertainties, Certainties and Urgencies
Attitudes Towards Risk
Risk Averse Consumer Behavior
Risk Averse Firm Behavior
Dynamic Games With Uncertain Payoffs
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Measuring Risk
Torts and Contracts
Introduction
Torts
Nash Equilibrium and Economic Efficiency
Contracts
Economic Efficiency and the Common Law
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Auctions
Introduction
Business, Auctions, and the Internet
FCC'S Wireless Spectrum Auction
EBay
Types of Auctions
Auctions with Complete and Perfect Information
Auctions with Independent Private Values
Google Goes Dutch
Auctions with Correlated Value Estimates
Common Value Auctions and the Winner's Curse
Auctions and Risk Averse Behavior
Revelation Principle
Chapter Review
Chapter Questions
Chapter Exercises
Dynamic Games with Imperfect Information
Introduction
Information Sets
Bayesian Updating
Adverse Selection and the Market for Lemons
Signaling
Spence Education Game
U S News & World Report College Rankings
Separating Strategy
Pooling Strategy
Screening
Chapter Review
Chapter Questions
Chapter Exercises
Notes
Glossary of Terms and Concepts
References and Suggestions for Further Reading
Index
Table of Contents provided by Ingram. All Rights Reserved.

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Introduction to Game Theory in Business and Economics

9780765622372

0765622378

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