Week 1 Flashcards
what is strategy?
the mental skill needed to do well in a game
what is game theory?
the analysis of interactive decision-making and the science of rational behavior in interactive situations
what is game of chicken?
two people drive cars toward each other and the first to swerve is the chicken
what is war of attrition?
each person in the game waits out the other
what is a signal?
strategy that conveys good information about you
what is a screening device?
strategy used to induce others to act in a way that credibly reveals their private info
what does an interaction need to be a strategic game?
there needs to be a mutual awareness of the cross effect of actions
what is cross effect of actions?
what one player does must affect the outcome of the player
how does an interaction between 2+ participants become strategic?
- mutual commitments
- private information
describe a mutual commitment?
- individual is chosen from a larger pool of individuals, and the agreement is clear and known by both parties
- strategy comes in when you must influence the other player’s actions
describe a zero-sum game?
only one winner and one loser – occurs when the players’ ints are in conflict
what is a constant sum game?
there is some positive amount that the players are in conflict over
what happens in one-shot games?
- no repercussions on other games
- no repercussions with other players who could learn about your typical actions
- players don’t know each others strengths/weaknesses
what happens in repeated games?
- opportunity to build reputations
- get to know your opponent better
what is strategic uncertainty?
uncertainty about what kind of moves one’s opponent has made in the past / is currently making
what is a game of perfect info?
no ext/strategic uncertainty
what is asymmetric info?
if one player knows more than other
what is a cooperative game?
games in which joint-action agreements are enforceable
what is a non-cooperative game?
games in which enforcement is not possible and individual participants are allowed to act in their own interests
what is a strategy in a game?
their complete plan of action that tells them what to do in every action the opponent takes.
what is pure strategy?
a strategy that always selects an action w certainty
what is the payoff?
number associated with each possible outcome
what is rationality?
implies that each player has a complete knowledge of their own ints and how to achieve it
what is equilibrium?
when each player is using the strategy that is the best response to the strategies of other players. at this point, no player wishes to switch to an alt strategy.
what is an evolutionary approach?
a dynamic process in which strategies that worked well in the past are likely to be used again
how do simultaneous move games occur?
- players move with no knowledge of what their opponent has chosen to do
- players choose at the same time in isolation
what are the payoffs in a zero sum game?
the payoff one player is the opposite of the other
does NE require one’s choices to be strictly better than one’s other choices?
no
how does one respond to decisions that are unknown and cannot be observed?
they can:
- guess
- use experience / observation
- logical reasoning
what is the NE definition?
a set of strategies, one for each player, such that each has correct beliefs about the strategies of others and the strategy of each is the best for themselves, given their beliefs
