Of course, here we are talking about an abstraction, for is anything ever truly common knowledge? Even if we’re sitting beside each other watching tel- evision, and a weather bulletin flashes along the bottom of the screen, am I sure that you saw it? Probably. But can I be sure that you saw me watching […]
SITUATION: HAGGLING AT AN AUTO DEALERSHIP, II This game is more complicated than the ones we have considered thus far. Consider the version in Figure 2.5. Marcus has four information sets: (1) the ini- tial node, (2) the node associated with his having offered pM and Donna’s having rejected it and made a counteroffer of
SITUATION: HAGGLING AT AN AUTO DEALERSHIP Read More »
Moving from the Extensive Form and Strategic Form 41 in a cell is Galileo’s payoff, the second is the Inquisitor’s payoff, and the third is the Pope’s payoff. In filling out the matrix, consider, for example, the strategy profile (Refer, DNC/C, Do not torture). The ensuing path is that the Pope refers the case, Galileo
Moving from the Extensive Form and Strategic Form 41 Read More »
SITUATION: GALILEO GALILEI AND THE INQUISITION, II Referring back to Figure 2.3, we see that Galileo has two information sets: one as- sociated with Pope Urban VIII’s referring the case to the Inquisitor and the other for the situation when it is referred, Galileo does not confess, and the Inquisitor tortures Galileo. A strategy for
SITUATION: GALILEO GALILEI AND THE INQUISITION Read More »
Strategic Form of Baseball Game 2,2 2,2 3,1 1,3 Orioles’ manager Yankees’ manager Retain Lopez Substitute Gibbons Retain Rivera Substitute Johnson FIGURE 2.14 Strategic Form of the Galileo and Inquisition Game Pope Urban VIII —Refer Pope Urban VIII—Do Not Refer 3,4,5 3,4,5 3,4,5 3,4,5 1,5,4 4,2,2 2,1,1 4,2,2 Galileo Inquisitor C/C C/DNC DNC/C DNC/DNC Torture
Strategic Form of Baseball Game Read More »
Moving from the Extensive Form and Strategic Form 39 � SITUATION: THE SCIENCE 84 GAME The magazine Science 84 came up with the idea of running the following con- test for its readership: Anyone could submit a request for either $20 or $100. If no more than 20% of the submissions requested $100, then everybody
Moving from the Extensive Form and Strategic Form 39 Read More »
Moderately conservative Moderate Conservative The payoffs reflect these two forces: a preference to be elected with a plat- form closer to one’s ideal, but also a desire to be elected. Note that a candidate’s payoff is higher when his or her rival is more extreme, as this makes it easier to get elected. For example,
Moderately conservative Moderate Conservative Read More »
SITUATION: COMPETITION FOR ELECTED OFFICE The word ‘politics’ is derived from the word “poly,” meaning “many,” and the word “ticks,” meaning “blood sucking parasites. —LARRY HARDIMAN Consider the path to the U.S. presidency. The Republican and Democratic can- didates are deciding where to place their campaign platforms along the polit- ical spectrum that runs from
SITUATION: COMPETITION FOR ELECTED OFFICE Read More »
What is a strategy for the kidnapper? To be more concrete as to the nature of a strategy in game theory, let us re- turn to the Kidnapping game in Figure 2.1. What is a strategy for the kidnap- per? As we’ve just said, a strategy is a complete decision rule—one that pre- scribes an
What is a strategy for the kidnapper? Read More »
What Is a Strategy? BUILDING A MODEL OF A STRATEGIC SITUATION 2.4 What Is a Strategy? Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win. —SUN TZU2 WHAT DO YOU THINK the preceding quote from Sun Tzu means? One interpreta- tion is that,
What Is a Strategy? Read More »