An Introduction to Game Theory

by Osborne, Martin J.

• ISBN13: 9780195128963
• ISBN10: 0195128966
• Format: Paperback
• Copyright: 2099-11-30
• Publisher: Oxford University Press

Summary

Game theoretic reasoning pervades economic theory and is used widely in other social and behavioral sciences. An Introduction to Game Theory presents the main ideas underlying this theory and shows how it can be used to understand economic, social, political, and biological phenomena. Emphasizing the ideas behind the theory rather than their mathematical expression, it assumes no specific knowledge beyond basic mathematics. It defines all concepts precisely and uses logical reasoning throughout.

Table of Contents

Preface

Each chapter ends with notes

Introduction

What is Game Theory?

An Outline of the History of Game Theory

John von Neumann

The Theory of Rational Choice

Coming Attractions: Interacting Decision-Makers

I. Games with Perfect Information

Nash Equilibrium: Theory

Strategic Games

Example: The Prisoner's Dilemma

Example: Bach or Stravinsky?

Example: Matching Pennies

Example: The Stag Hunt

Nash Equilibrium

John F. Nash, Jr

Studying Nash Equilibrium Experimentally

Examples of Nash Equilibrium

Experimental Evidence on the Prisoner's Dilemma

Focal Points

Best Response Functions

Dominated Actions

Equilibrium in a Single Population: Symmetric Games and Symmetric Equilibria

Nash Equilibrium: Illustrations

Cournot's Model of Oligopoly

Bertrand's Model of Oligopoly

Cournot, Bertrand, and Nash: Some Historical Notes

Electoral Competition

The War of Attrition

Auctions

Auctions from Babylonia to eBay

Accident Law

Mixed Strategy Equilibrium

Introduction

Some Evidence on Expected Payoff Functions

Strategic Games in Which Players May Randomize

Mixed Strategy Nash Equilibrium

Dominated Actions

Pure Equilibria When Randomization is Allowed

Illustration: Expert Diagnosis

Equilibrium in a Single Population

Illustration: Reporting a Crime

Reporting a Crime: Social Psychology and Game Theory

The Formation of Players' Beliefs

Extension: Finding All Mixed Strategy Nash Equilibria

Extension: Games in Which Each Player Has a Continuum of Actions

Appendix: Representing Preferences by Expected Payoffs

Extensive Games with Perfect Information: Theory

Extensive Games with Perfect Information

Strategies and Outcomes

Nash Equilibrium

Subgame Perfect Equilibrium

Finding Subgame Perfect Equilibria of Finite Horizon Games: Backward Induction

Ticktacktoe, Chess, and Related Games

Extensive Games With Perfect Information: Illustrations

The Ultimatum Game, the Holdup Game, and Agenda Control

Experiments on the Ultimatum Game

Stackelberg's Model of Duopoly

Buying Votes

A Race

Extensive Games With Perfect Information: Extensions and Discussion

Allowing for Simultaneous Moves

More Experimental Evidence on Subgame Perfect Equilibrium

Illustration: Entry into a Monopolized Industry

Illustration: Electoral Competition with Strategic Voters

Illustration: Committee Decision-Making

Illustration: Exit from a Declining Industry

Allowing for Exogenous Uncertainty

Discussion: Subgame Perfect Equilibrium and Backward Induction

Experimental Evidence on the Centipede Game

Coalitional Games and the Core

Coalitional Games

The Core

Illustration: Ownership and the Distribution of Wealth

Illustration: Exchanging Homogeneous Horses

Illustration: Exchanging Heterogeneous Houses

Illustration

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