Game Theory

1
Game Theory

• Game 3
• Sequential Games

2
Four Personalities

• Enter Accommodate Nice
• Enter Fight Selfish
• Out Accommodate Too Nice
• Out Fight Mean

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(No Transcript)
4
Class Division

• Nice (Enter,Accommodate) 34
• Selfish (Enter,Fight) 2
• Too Nice (Out,Accommodate) 3
• Mean (Out,Fight) 2
• Enter 36 Out 5
• Accommodate 37 Fight 4

5
Poetic Justice

• Nice v. Nice (both share) 100
• Mean v. Mean (both monop.) 100
• Nice v. Too Nice 150 / 50
• Nice v. Selfish 0 / 0
• Nice v. Mean 50 / -50

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Nice

• And Lucky (vs. Too Nice) 150 points
• Dana
• Wonyoung
• But Unlucky (vs. Mean) 50 points
• Shivam
• But Very Unlucky (vs. Selfish) 0 points
• Edward
• Jonathan

7
And

• Too Nice 50 points
• Sarah
• Shannon
• Selfish 0 points
• ONeill
• Helal
• Mean -50 points
• Yi Pei

8
Optimal Strategies

• 1 students
• 39 students
• Expected Payoff
• -50(4/41) 50(37/41) 40
• Entry is profitable!

9
Summary

• Thinking ahead is critical!
• People DO make the right decision in the
  present
• You must anticipate that decision in
  the future