Week 3: Games and Collective Behavior

Question 1

satisfices

Answer 1

provides at least as much utility as some aspiration level agents will search over alternatives, stopping when they find one that’s good enough. e.g. buying a car

Question 2

Condorcet Jury Theorem

Answer 2

The majority is more accurate than any individual. As the number of voters grows, the prob. of correct decision converges to 1.

Question 3

Median Voter

Answer 3

majority rule chooses the median voter’s deal.

Question 4

prisoner’s dilemma

Answer 4

Each prisoner is given the opportunity either to: betray the other by testifying that the other committed the crime, or to cooperate with the other by remaining silent. The offer is:

• If A and B each betray the other, each of them serves 2 years in prison
• If A betrays B but B remains silent, A will be set free and B will serve 3 years in prison (and vice versa)
• If A and B both remain silent, both of them will only serve 1 year in prison (on the lesser charge)

It is implied that the prisoners will have no opportunity to reward or punish their partner other than the prison sentences they get, and that their decision will not affect their reputation in the future. Because betraying a partner offers a greater reward than cooperating with him, all purely rational self-interested prisoners would betray the other, and so the only possible outcome for two purely rational prisoners is for them to betray each other

Question 5

dominant strategy

Answer 5

best action regardless of opponent’s strategy

Question 6

Nash Equilibrium

Answer 6

best action given opponent’s strategy. exists, but not always unique. A dominant strategy eq is a Nash eq.