CdSECONOMIA E COMMERCIO
Codice626PP
CFU6
PeriodoPrimo semestre
LinguaItaliano
The course is meant to introduce the student to the basic theoretical apparatus of decision theory, mainly decisions under risk and strategic decisions (Game Theory). Behavior in games will be analyzed both in the non-cooperative and the coperative framework. The course will provide the main tools and concepts to interpret many economic and social phenomena stemming out of individual and/or group strategic interaction.
To be defined
By the end of the course students will be able to frame situations characterized by exogenous uncertainty or strategic uncertainty coming out of interaction among persons or group of persons in games. The tools that will be introduced will help the student to rationalize and analyze these situations and predict the outcomes on the presumption of indiivdual and group rationality
The course is meant for a wide public of students both in economics and social sciences. The mathematical tools are kept at the very basic level; however some knowledge of probability theory and of the methods and concepts introduced in a basic course in Microeconomics are highly advised.
Delivery: on line on the MS Teams platform (LINK)
Learning activities:
- attending lectures
- individual study
Attendance: strongly advised
As to individual decisions:
- Choice structures. alternatives and criteria (preferences)
- Certainty, Uncertainty and Risk.
- Lotteries and preferences over lotteries. Partial ranking of lotteries and optimal decisions.
- Paradoxes
As to non cooperative games, the basic notion of strategies will be introduced and the concept of a strategic equilibrium will be analyzed :
- Payoffs and representations of non cooperative games
- Strategies: pure/mixed, dominant/dominated, rationalizable, best response
- Equilibrium for non-cooperative games: unicity, multiplicity, absence of equilibria in pure strategies, efficiency.
Bargaining problem:
- The Nash bargaining problem: representation, solution.
- Alternative solutions
As to cooperative games (in coalitional form), the basic notion of a characteristic function will be introduced together with key solution concepts, mainly the "core" and "Shapley" value
- Representation of cooperative games and its properties
- Imputations
- Stable allocations: the "core" of a cooperative game
- The "Shapley" value
- Applications
- Dehez, Pierre (2020), Conflict, bargaining, cooperation and power. An introduction to game theory
- Resnik, Michael D. (1987) Choices: An Introduction to Decision Theory. University of Minnesota Press
Optional readings
- Maschler Michael, Eilon Solan and Schmuel Zamir, Game theory, Cambridge University Press, 2013.
- Osborne Martin, An introduction to game theory, Oxford University Press, 2009.
- Myerson Roger, Game theory, analysis of conflict, Harvard University Press, 1991.
- Rubinstein Ariel et Martin Osborne, A course in game theory, MIT Press, 1994.
(disponibile: arielrubinstein.tau.ac.il)
FURTHER MATERIAL MAY BE DISTRIBUTED DURING THE LECTURES
Online examination through the Moodle platform