Game Theory And Its Applications

Content

Objective

Game Theory is used in this course to study incentives and strategic behavior in practical situations of inter-dependent decision making. The course will develop better understanding of the basic theoretical results in game theory and their proofs. Balanced time to both theory and applications will be spent. There will be such applications on economic models, auction theory and so on. The participants are encouraged to work on their special interests, e.g. business, politics, etc. of course including Game Theory in their assignments.
The goals of the course to provide participants with a foundation to:
Develop familiarity with basic results in game theory;
Develop a familiarity with mathematical tools used in game theory;
Understand the assumptions and the limitations of results in game theory, and the questions that result from those;
Understand the application topics of game theory;
Develop the ability to read papers involving game theory, and understand the technical parts of the papers.

Course Content

Introduction, Why study Games? A brief history, The assumptions of Game Theory, Classifying Games
Static Games of Complete Information: Basic Theory and Nash Equilibrium
Static Games of Complete Information: Applications and Mixed Strategies
Static Games of Complete Information: Mixed Strategies and Existence of a Nash Equilibrium
Dynamic Games of Complete Information: Complete and perfect information and two-stage games of complete but imperfect information
Dynamic Games of Complete Information: Repeated games and dynamic games with complete but imperfect information
Static Games of Incomplete Information: Bayesian Games and Bayesian Nash Equilibrium
Static Games of Incomplete Information: Mixed strategies and an auction
Dynamic Games of Incomplete Information: Perfect Bayesian Equilibrium and signaling games
Case Study;-Finance, Accounting, Operations Management and Information systems
Case Study; Incentive contractions and the Franchise Decision, Cooperative games and business strategy, The practice of bargaining

Course Learning Outcomes

1: Describes the basics of Game Theory;
2: Solves the problems in Nash Equilibrium and Mixed-strategies topics;
3: Discriminates the dynamic and static games;
4: Analyzes perfect and imperfect information games;
5: Evaluates different cases based on game theory;
6: Comments on academicals papers containing game theory.

References

Gibbons, Robert, “Game Theory for Applied Economists”, Princeton University Press, 1992.
Osborne, Martin J., and Rubinstein, Ariel, “A Course in Game Theory”, MIT Press, 1994.
Chatterjee, K., Samuelson, W. F., “Game Theory and Business Applications”, Kluwer Academic Publishers, 2002.
Geçkil, Ilhan Kubilay, and Anderson, Patrick L., “Applied Game Theory and Strategic Behavior”, CRC Press, 2010.
Fudenberg, Drew, and Tirole, Jean, “Game Theory”, 5th Edition, MIT Press, 1996.

Weekly Contents

Assessment System

Relation of Proficiency

ECTS