StudentShare solutions

# Game Theory - Research Paper Example

## Extract of sampleGame Theory

Game theory is mainly applied in areas such as psychology, logic, biology, economics, and political science. This is a report on game theory with particular focus given to its applications, benefits and limitations, and other aspects. Game Theory Game theory or alternatively interactive decision theory is based on the fundamental concept of zero-sum games, where gains of an individual are exactly to the net losses of other participants. The game theory can be applicable to a range of behavioral relations. According to the game theory, a game must specify four essential elements such as players of the game, information and actions (which are available for decision making), and payoffs for each outcome (Game Theory). The two main branches of game theory include cooperative and non-cooperative game theory. When the non-cooperative games are illustrated in the extensive and normal forms, characteristic function form is used to present most cooperative games. According to Fudenberg and Tirole, in the extensive form, games are played using trees (see figure 1) and each node (vertex) indicates a player’s point of choice. Each player is clearly specified with a number represented by the vertex (67). The player’s possible action is indicated by the lines out of the vertex whereas the payoffs are presented at the bottom of the tree. The extensive form can be regarded as “a multi-player generalizations of a decision tree” (Fudenberg and Tirole 67). This is illustrated in the figure 1. Figure 1 The figure is taken from Ross, Don, "Game Theory", The Stanford Encyclopedia of Philosophy (Winter 2012 Edition), In contrast to the extensive form, a matrix indicating players, strategies and payoffs are used to represent the normal form or strategic form. As Jian et al point out, in general any function which is associated with a payoff for each player with all combination of actions can be used to represent the normal form. When the normal form is used to define a game, it is assumed that each player acts without actually knowing the actions of others. If the players are aware of the action of other players, the game is usually illustrated using the extensive form. The origin of the characteristic function form is found in the book written by John von Neumann and Oskar Morgenstern. The authors guessed that when a union C emerges, it functions against the fraction (N/C) as if a normal game is played by two individuals. Here, the balanced payoff of C is identified as the basic function. Examples of Game Theory One of the most commonly cited examples of game theory is the prisoner’s dilemma. Suppose that two brokers, Robinson and Thomas, have been accused of fraudulent trading activities and arrested. Both of them are being questioned separately and hence they do not know what the other is going to say. Robinson and Thomas want to minimize the term of imprisonment and there are four different situations. 1. If Robinson pleads that he is not guilty of the crime accused and Thomas confesses, Robinson will be jailed for a maximum term of five years and Thomas will be sentenced for a minimum of one year imprisonment. 2. If nobody confesses, then both of them will be jailed for a minimum of two years. 3. If both pleads that they are guilty of the crime accused and tries to implicate their partner, then both of the ...Show more

## Summary

Game Theory Introduction Game theory can be simply referred to a tool for strategic decision making. In a narrow sense, game theory is a mathematical theory which is formed of games termed as zero-sum games. The paper ‘Theory of games and economic behavior (TGEB) published by Von Neumann is generally considered as the starting point of the game theory…
Author : zemlakhayley
Save Your Time for More Important Things
Let us write or edit the research paper on your topic
"Game Theory"
with a personal 20% discount.
Grab the best paper

### Related Essays

Game Theory
Here, we are going to analyze what is known as game theory. Different types of theory are going to be explained at length in this paper, which include: game theory itself (the normal version); decision theory (one-person games); zero-sum games; two-person games; and n-person games.
12 pages (3000 words) Research Paper
Most students in adolescent age play games and get excited with the video games or other devices every day. Most of them are able to organize the several demands of schoolwork, sports, or everyday jobs and their family life.
13 pages (3250 words) Research Paper
Behavioral economics & game theory in managerial microeconomics
Managerial economics is based on the assumption that formulation of logical managerial decision is possible. Managers are enabled to make rational decisions, their decisions become imperative component of organization success. Concepts of the game theory and behavioral theory, that facilitate process of decision-making is considered in the paper.
10 pages (2500 words) Research Paper
1-2). However after the cold war, relationships between South Korea (ROK) and its allies, the US and Japan and their former common enemies changed drastically, with the Soviet Union in 1991 and China in1992 opening diplomatic relations
13 pages (3250 words) Research Paper
Contemporary Application of Economic Theory (proposal)
This is a model that permits the bank to provide “judgement-free statistical forecasts of inflation and output growth as inputs into the forecasting process, and to offer measures of relevant news in the data” (Kapetanios G, Labhard V and
2 pages (500 words) Research Paper
Psychology game
d to certain elements visual imagery and drugs to function, without psychological reactions to its absence; frequently the results of tolerance and dependence. Learning involves the deliberate desire to build more knowledge and skills, and utilizing the mental faculties to
1 pages (250 words) Research Paper
Game and Drama Theories
The discussion below concludes that these theories can be used to solve any type of conflicts. The discussion also includes situations where intercultural conflicts resolution is achieved through the use of game and drama
3 pages (750 words) Research Paper
How video game addiction is going to affect people
etc.), but at the same time, gamers were also experiencing a negative impact the process was making on their physical and mental health, and on their socialization, requiring from professionals to give a definition of observed effect. Nowadays, a video game overuse hasn’t
5 pages (1250 words) Research Paper
Game Theory
There are two of the decisive branches of Game Theory, which include Cooperative and Non-Cooperative Game Theory (MIT, “Game Theory”). One of the sub theories of Game theory is the Folk theorem, which is extensively prevalent in the study of
8 pages (2000 words) Research Paper
Game theory research paper
It will be followed by assigning each of the players or bidders a character of i. Each bidder will be given a value vi of for each of the paintings being sold (Nisan, Roughgarden, Tardos and Vazirani 12). Each player can
5 pages (1250 words) Research Paper
Get a custom paper written
by a pro under your requirements!
Win a special DISCOUNT!
Put in your e-mail and click the button with your lucky finger