Game Theory and Business Strategy: Difference between revisions
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[[Cooperation Game]] | [[Bargaining Game]] | [[Business Strategies]] | [[Case Study]] | |||
Economists have used game theory to analyze a wide array of economic phenomena, including auctions, bargaining, duopolies, oligopolies, social network formation, and voting systems. This research usually focuses on particular sets of strategies known as equilibria in games. These "solution concepts" are usually based on what is required by norms of rationality. The most famous of these is the Nash equilibrium. A set of strategies is a Nash equilibrium if each represents a best response to the other strategies. So, if all the players are playing the strategies in a Nash equilibrium, they have no incentive to deviate, since their strategy is the best they can do given what others are doing. | Economists have used game theory to analyze a wide array of economic phenomena, including auctions, bargaining, duopolies, oligopolies, social network formation, and voting systems. This research usually focuses on particular sets of strategies known as equilibria in games. These "solution concepts" are usually based on what is required by norms of rationality. The most famous of these is the Nash equilibrium. A set of strategies is a Nash equilibrium if each represents a best response to the other strategies. So, if all the players are playing the strategies in a Nash equilibrium, they have no incentive to deviate, since their strategy is the best they can do given what others are doing. | ||
Revision as of 02:10, 5 May 2006
Cooperation Game | Bargaining Game | Business Strategies | Case Study
Economists have used game theory to analyze a wide array of economic phenomena, including auctions, bargaining, duopolies, oligopolies, social network formation, and voting systems. This research usually focuses on particular sets of strategies known as equilibria in games. These "solution concepts" are usually based on what is required by norms of rationality. The most famous of these is the Nash equilibrium. A set of strategies is a Nash equilibrium if each represents a best response to the other strategies. So, if all the players are playing the strategies in a Nash equilibrium, they have no incentive to deviate, since their strategy is the best they can do given what others are doing.
