Introduction to Game Theory

2018/2019

Учебный год

ENG

Обучение ведется на английском языке

3

Кредиты

Кто читает:

Департамент психологии

Статус:

Курс по выбору

Когда читается:

2-й курс, 4 модуль

Course Syllabus

Abstract

This course provides a brief introduction to game theory. Our main goal is to understand the basic ideas behind the key concepts in game theory, such as equilibrium, rationality, and cooperation. The course uses very little mathematics, and it is ideal for those who are looking for a conceptual introduction to game theory. Business competition, political campaigns, the struggle for existence by animals and plants, and so on, can all be regarded as a kind of “game,” in which individuals try to do their best against others. Game theory provides a general framework to describe and analyze how individuals behave in such “strategic” situations. Game theory has been applied to a number of disciplines, including economics, political science, psychology, sociology, biology, and computer science.

Learning Objectives

• The reason why we need game theory to analyze social problems
• Nash equilibrium as a unified solution concept
• The reason why players come to play Nash equilibrium
• The relationship between intellectual capacity of players and Nash equilibrium
• The relationship between the rationality of individuals and socially desirable outcomes

Expected Learning Outcomes

• Understand expected utility theory and the role of probabilities in explaining behaviour.
• Construct models of bargaining and negotiation and how they can be applied to models of competition.
• Distinguish between the different strands of game theory.
• Justify the predictions of non-cooperative game theory an evolutionary perspective.

Course Contents

• Why do we need game theory, and what does it tell us?
  Is it possible to analyze a wide variety of social and economic problems using a unified framework? In the first week, we address this question. We will see that the concept of rational decision making is useful, but it is not quite sufficient to provide governing principles. Motivated examples and some history of game theory will be provided. You will also be asked to play a simple card game to see how it feels to make your decisions strategically.
• Understanding Nash equilibrium
  The basic solution concept of game theory is Nash equilibrium. In the second week, we try to understand this central concept through various examples and ask the following crucial question: how do players come to play a Nash equilibrium?
• Rationality, knowledge, and evolution in games
  In the third week, we will dig deeper into the relationship between rationality and Nash equilibrium. We will consider the whole spectrum of possible intellectual capacities of players, spanning the range from unlimited ability for sophisticated reasoning to absolute zero intelligence. In the end, you will see that Nash equilibrium can emerge under a fairly wide range of intellectual capacities of players.
• Sustaining cooperation
  The final week is devoted to the most important and most general message of game theory: rational behavior quite often leads to a socially undesirable outcome. We will first try to understand the basic reason for this, and then see how this insight of game theory has made fundamental impacts in the natural and social sciences. Finally, we will learn some general methods to overcome this problem.

Assessment Elements

• Weekly tests
• The final exam

Interim Assessment

• Interim assessment (4 module)
  The final grade is calculated on the basis of: the final exam (100%). The grades will be given on a scale of 1 to 10 throughout the class

Bibliography

Recommended Core Bibliography

• Tuboly, A. T. (2017). Paul Humphreys, ed., The Oxford Handbook of Philosophy of Science. Reviewed by. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.D5792919

Recommended Additional Bibliography

• Rawling, P., Mele, A. R., & Oxford University Press. (2004). The Oxford Handbook of Rationality. Oxford: OUP Premium. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=215585
• Zamir, S., Solan, E., & Maschler, M. (2013). Game Theory. Cambridge: Cambridge eText. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=527892