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Course 2015-2016 a.y.

20290 - GAME THEORY: ANALYSIS OF STRATEGIC THINKING


CLMG - M - IM - MM - AFC - CLAPI - CLEFIN-FINANCE - CLELI - ACME - DES-ESS - EMIT
Department of Economics

Course taught in English


Go to class group/s: 31

CLMG (6 credits - II sem. - OP  |  SECS-P/01) - M (6 credits - II sem. - OP  |  SECS-P/01) - IM (6 credits - II sem. - OP  |  SECS-P/01) - MM (6 credits - II sem. - OP  |  SECS-P/01) - AFC (6 credits - II sem. - OP  |  SECS-P/01) - CLAPI (6 credits - II sem. - OP  |  SECS-P/01) - CLEFIN-FINANCE (6 credits - II sem. - OP  |  SECS-P/01) - CLELI (6 credits - II sem. - OP  |  SECS-P/01) - ACME (6 credits - II sem. - OP  |  SECS-P/01) - DES-ESS (6 credits - II sem. - OP  |  SECS-P/01) - EMIT (6 credits - II sem. - OP  |  SECS-P/01)
Course Director:
PIERPAOLO BATTIGALLI

Classes: 31 (II sem.)
Instructors:
Class 31: PIERPAOLO BATTIGALLI


Course Objectives

This course provides an introduction to Game Theory, the formal analysis of strategic interaction. Game Theory now pervades most non-elementary models in microeconomic theory and many models in the other branches of economics. The course introduces the necessary analytical tools to be able to understand these models and illustrates them with some economic applications. The course also aims at developing an abstract analysis of strategic thinking, a critical and open minded attitude towards the standard as well as new game theoretic concepts, and to correct some widespread misunderstandings of game theory.


Course Content Summary
  • Introduction to interactive decision theory, terminology, notation.
  • Rationality and dominance, rationalizability.
  • Nash equilibrium, interpretation, existence.
  • Mixed strategy equilibrium, interpretation, existence.
  • Correlated and selfconfirming equilibrium.
  • Games with asymmetric or incomplete information.
  • Dynamic games, strategic forms, weak dominance, backward and forward
    induction.
  • Subgame perfect equilibrium, one-shot-deviation principle.
  • Repeated games and multiplicity of equilibria.
  • Bargaining games and uniqueness of equilibrium.
  • Dynamic games with asymmetric or incomplete information, equivalence
    principles.
  • System of beliefs and perfect Bayesian equilibrium.
  • Signaling games, pooling and separating equilibria, intuitive criterion.

Detailed Description of Assessment Methods

Written Exam.  

The students can choose to take a two-part written exam (intermediary and final), or only a final written exam.


Textbooks
  • M.J. OSBORNE, A. RUBINSTEIN, A Course in Game Theory, Cambridge MA, MIT Press, 1994.
  • Additional lectures notes are distributed during the course.

Prerequisites

Introduction to: 

  • elementary set theory: sets, Cartesian products, functions.
  • Elementary analysis: open, closed and bounded sets, limits, continuity, derivatives and maximization.
  • Linear algebra: vectors and operations on vectors, graphical representation on the Cartesian plane.
  • Probability theory: probabilities on finite state spaces, conditional probabilities, Bayes rule.
  • Decision theory: expected utility.
Last change 15/06/2015 12:16