On Coordination In Non Cooperative Game Theory

By offering a critical assessment of the evolution of standard game theory, this book argues for a shift in the ontology and methodology of game theory for appraising games, one based on understanding the players’ strategic reasoning process. Analyzing the history of economic thought, the book highlights the methodological issues faced by standard game theory in its treatment of strategic reasoning and the consequence it has on the status of players’ beliefs. It also highlights how the two original contributions of T. C. Schelling and M. Bacharach can be applied to these issues. Furthermore, the book assesses the intersubjective dimension in games by applying the cognitive sciences and by integrating simulation theory into game theory. Consequently, this book offers an interdisciplinary approach for reassessing the nature of the intersubjectivity involved in strategic reasoning. It shows that the analysis of games should involve the study and identification of the reasoning process that leads the players to a specific outcome, i.e., to a specific solution. A game should not be understood (as is done in standard game theory) as a mathematical representation of an individual choice at equilibrium. This requires investigating the players’ capacity for coordination. Understanding the process of coordination allows us to understand strategic reasoning and ultimately to provide new answers to the indeterminacy problem, one of the central hurdles in game theory, and one that underscores its normative difficulties.

This is a textbook for university juniors, seniors, and graduate students majoring in economics, applied mathematics, and related fields. Each chapter is structured so that a core concept of that chapter is presented with motivations, useful applications are given, and related advanced topics are discussed for future study. Many helpful exercises at various levels are provided at the end of each chapter. Therefore, this book is most suitable for readers who intend to study non-cooperative game theory rigorously for both theoretical studies and applications. Game theory consists of non-cooperative games and cooperative games. This book covers only non-cooperative games, which are major tools used in current economics and related areas. Non-cooperative game theory aims to provide a mathematical prediction of strategic choices by decision makers (players) in situations of conflicting interest. Through the logical analyses of strategic choices, we obtain a better understanding of social (economic, business) problems and possible remedies. The book contains many well-known games such as the prisoner’s dilemma, chicken (hawk–dove) game, coordination game, centipede game, and Cournot, Bertrand, and Stackelberg models in oligopoly. It also covers some advanced frameworks such as repeated games with non-simultaneous moves, repeated games with overlapping generations, global games, and voluntarily separable repeated prisoner’s dilemma, so that readers familiar with basic game theory can expand their knowledge. The author’s own research is reflected in topics such as formulations of information and evolutionary stability, which makes this book unique.

Recent interest in biological games and mathematical finance make this classic 1982 text a necessity once again. Unlike other books in the field, this text provides an overview of the analysis of dynamic/differential zero-sum and nonzero-sum games and simultaneously stresses the role of different information patterns. The first edition was fully revised in 1995, adding new topics such as randomized strategies, finite games with integrated decisions, and refinements of Nash equilibrium. Readers can now look forward to even more recent results in this unabridged, revised SIAM Classics edition. Topics covered include static and dynamic noncooperative game theory, with an emphasis on the interplay between dynamic information patterns and structural properties of several different types of equilibria; Nash and Stackelberg solution concepts; multi-act games; Braess paradox; differential games; the relationship between the existence of solutions of Riccati equations and the existence of Nash equilibrium solutions; and infinite-horizon differential games.

The objective of the third edition of Game Theory: A Nontechnical Introduction to the Analysis of Strategy is to introduce the ideas of game theory in a way that is approachable, intuitive, and interdisciplinary. Relying on the Karplus Learning Cycle, the book is intended to teach by example. Noncooperative equilibrium concepts such as Nash equilibrium play the central role. In this third edition, increased stress is placed on the concept of rationalizable strategies, which has proven in teaching practice to assist students in making the bridge from intuitive to more formal concepts of noncooperative equilibrium. The Instructor Manual and PowerPoint Slides for the book are available upon request for all instructors who adopt this book as a course text. Please send your request to [email protected].

This book provides a critical, selective review of concepts from game theory and their applications in public policy, and further suggests some modifications for some of the models (chiefly in cooperative game theory) to improve their applicability to economics and public policy.

Fundamentals; Two-Person Games; Larger Numbers and Uncertainty; Games in Extensive Form and Repeated Play; Cooperation; Behavioral Game Theory; Selected Applications.

As with the previous editions, this fourth edition relies on teaching by example and the Karplus Learning Cycle to convey the ideas of game theory in a way that is approachable, intuitive, and interdisciplinary. Noncooperative equilibrium concepts such as Nash equilibrium, mixed strategy equilibria, and subgame perfect equilibrium are systematically introduced in the first half of the book. Bayesian Nash equilibrium is briefly introduced. The subsequent chapters discuss cooperative solutions with and without side payments, rationalizable strategies and correlated equilibria, and applications to elections, social mechanism design, and larger-scale games. New examples include panic buying, supply-chain shifts in the pandemic, and global warming.