In this lecture, we will study the basics of game theory. We will look at what game theory is, why is it important and how individuals can benefit from studying game theory. Furthermore, we will look at some technical aspects of this subject. We will study what is a dominant strategy, what Nash Equilibrium is and how to find a Nash Equilibrium (pure strategy and mixed strategies). Lastly, we will look at three classical games, the prisoner’s dilemma, the battle of sexes and the co-operative game of dividing a pie.
This is a specific prerequisite for this series. I will cover every needed in this video. However, it is recommended that you have taken some courses in economics before. Additionally, a course in probability would be helpful.
In this series: 5 Videos | 00:51:42 Total Length
The series is introduced, and Academic Expert Albert Li explains what a payoff matrix is and introduces the concept of Nash Equilibrium.
More on Nash Equilibrium and choosing a Dominant Strategy.
The classic game in economics, The Prisoner's Dilemma is introduced and explained with examples, followed by an explanation of mixed strategy games.
The example of a kicker and a goal keeper and how the goal keeper should defend is explained, solved and analyzed.
The series ends with a game explained market and entry and the probability of opening a new store.