Introduction to Strategic Games: What is game theory? The theory of rational choice, Strategic games; Examples: The prisoner’s dilemma, Bach or Stravinsky, Matching pennies; Nash equilibrium; Examples of Nash equilibrium; Best response functions; Dominated actions.

(8 hours)

(RBT Levels: L1, L2 and L3)

Teaching-Learning Process: Chalk and talk method / PowerPoint Presentation

Introduction; Strategic games in which players may randomize; Mixed strategy Nash equilibrium; Dominated actions; Pure equilibrium when randomization is allowed. Illustration: Expert Diagnosis; Equilibrium in a single population.

(8 hours)

(RBT Levels: L1, L2 and L3)

Teaching-Learning Process: Chalk and talk method / PowerPoint Presentation

Extensive games with perfect information; Strategies and outcomes; Nash equilibrium; Subgame perfect equilibrium; Finding sub-game perfect equilibria of finite horizon games: Backward induction; Illustrations: The ultimatum game, Stackelberg’s model of duopoly.

(8 hours)

(RBT Levels: L1, L2 and L3)

Teaching-Learning Process: Chalk and talk method / PowerPoint Presentation

Bayesian Games, Motivational examples; General definitions; Two examples concerning information; Illustrations: Cournot’s duopoly game with imperfect information, Providing a public good; Auctions: Auctions with an arbitrary distribution of valuations.

(8 hours)

(RBT Levels: L1, L2 and L3)

Teaching-Learning Process: Chalk and talk method / PowerPoint Presentation

Competative Games: Strictly competitive games and maximization.

Repeated games: The main idea; Preferences; Repeated games; Finitely and infinitely repeated Prisoner’s dilemma; Strategies in an infinitely repeated Prisoner’s dilemma; Nash equilibrium of an infinitely repeated Prisoner’s dilemma, Nash equilibrium payoffs of an infinitely repeated Prisoner’s dilemma.

(8 hours)

(RBT Levels: L1, L2 and L3)

Teaching-Learning Process: Chalk and talk method / PowerPoint Presentation