Lecture 3: Sequential Games Flashcards
1
Q
Sequential Game
A
a game where players move in sequence, one after the other
2
Q
Backwards induction
A
where a player in a sequential game choses strategy by anticipating strategy that will be chosen by other players in response
3
Q
Extensive form game
A
game portrayed by game tree
4
Q
Normal form representation
A
description of game by matrix of strategies
5
Q
First mover advantage
A
a player who can commit to a strategy first before other players
6
Q
Ultimatum game
A
‘one shot’ interaction game where a player can accept or reject an offer
7
Q
4 steps in an ultimatum game
A
- proposer is first mover, responder is other
- proposer has endowment (£x) which responder knows about
- proposer decides how to divide endowment between them ranging from £0 - £x
- responders can either accept or reject offer, then game ends
