What is Game Theory? Begin with what it is not.
In pre-game-theory economics, each decision maker takes the environment as given:
Consumers take prices as given (price-taking assumption) when deciding consumption. This leads to an aggregate demand curve.
Firms take prices as given when deciding their production plan. This leads to an aggregate supply curve.
Aggregate demand and aggregate supply jointly determine a competitive equilibrium price.
The methodology that deals with strategic situations with a “small” number of players:
Game Theory
= Multiple-Person Decision Theory
= Interactive Decision Theory.
Game theory has revolutionized economics and many other fields in recent decades.
The course contains two parts.
The first part is about basic mathematical theories of games: how to model and solve a strategic situation.
The second part is on selected topics and advanced applications.
Apologies and Trust
Political Economy
Behavioral Game Theory