Game theory is a set of tools for studying situations in which decision-makers interact (such as consumers, firms, politicians, and governments). This unit provides a comprehensive yet intuitive introduction the sub-filed of non-cooperative game theory, namely dynamic games and games of incomplete information. There will be a strong emphasis on applications of these techniques and equilibrium concepts to economics. The aim of this unit is to give students an understanding of core concepts of game theory, namely Backwards Induction, Subgame perfect Nash Equilibrium, and Bayes Nash Equilibrium. The aim of this unit is to allow students to construct predictions of individual strategic behaviour in dynamic settings so as to uncover the mechanisms behind important economic, social, and political phenomena.
You’ll learn to:
- Apply principles of economic-mathematical modelling to practical economic and business problems in which decision-makers choose their actions sequentially or in ignorance of each other’s characteristics
- Evaluate economic and business problems by designing appropriate economic-mathematical models of dynamic strategic interactions
- Solve, analytically or numerically, economic-mathematical models of dynamic strategic interactions using advanced quantitative methods
- Develop analytically founded policy or business recommendations
- Construct programs using mathematical computing software in order to solve/simulate economic models of dynamic strategic interactions that capture important real-world phenomena