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"Game theory is when I take these impacts my choices have on other people into account when making my decision." The "game" is the interaction between two or more parties, and relies on people. Game theory, branch of applied mathematics that provides tools for analyzing situations in which parties, called players, make decisions that are interdependent. This interdependence causes each player to consider the other player’s possible decisions, or strategies, in formulating his own. Game Theory Articles. Evolutionary Game Theory. Evolutionary Game Theory Evolutionary Game Theory is the application of game theory concepts to situations in which a population of agents with diverse strategies interact over time to create a stable solution, through [ ] Read More.


Game Theory Articles – Systems Innovation


Game theory is the study of mathematical models of strategic interaction in between rational decision-makers. Originally, it addressed zero-sum gamesin which each participant's gains or losses are exactly balanced by those of the other participants.

Today, game theory applies to a wide range of behavioral relations, and is now an umbrella term for the science of logical decision making in humans, animals, and computers. Modern game theory began with the idea regarding the existence of mixed-strategy equilibria in two-person zero-sum games and its proof by John von Neumann.

Von Neumann's original proof used the Brouwer fixed-point theorem on continuous mappings into compact convex game theory articleswhich became a standard method in game theory and mathematical economics.

His paper was followed by the book Theory of Games and Economic Behaviorco-written with Oskar Morgensternwhich considered cooperative games of several players. The second edition of this book provided an axiomatic theory of expected utility, which allowed mathematical statisticians and economists to treat decision-making under uncertainty.

Game theory was developed extensively in the s by many scholars. It was later explicitly applied to biology in the s, although similar developments go back at least as far as the s. Game theory has been widely recognized as an important tool in many fields. John Maynard Smith was awarded the Crafoord Prize for his application of game theory to biology. Early discussions of examples of two-person games occurred long before the rise of modern, mathematical game theory.

The first known discussion of game theory occurred in a letter believed to be written by Charles Waldegrave, an active Jacobiteand uncle to James Waldegravea British diplomat, in One theory, however, postulates Francis Waldegrave was the true correspondent but it has yet to be proven.

It proved that the optimal chess strategy is game theory articles determined. This paved the way for more general theorems, game theory articles. Inthe Danish mathematical economist Frederik Zeuthen proved that the mathematical model had a winning strategy by using Brouwer's fixed point theorem.

Borel conjectured that non-existence of mixed-strategy equilibria in finite two-person zero-sum games would occur, a conjecture that was proved false by von Neumann. Game theory did not really exist as a unique field until John von Neumann published the paper On the Theory of Games of Strategy in Von Neumann's work in game theory culminated in this book.

This foundational work contains the method for finding mutually consistent solutions for two-person zero-sum games, game theory articles. During the following time period, work on game theory was primarily game theory articles on cooperative game theory, which analyzes optimal strategies for groups of individuals, presuming that they can enforce agreements between them about proper strategies. Inthe first mathematical discussion of the prisoner's dilemma appeared, and an experiment was undertaken by notable mathematicians Merrill M, game theory articles.

RAND pursued the studies because of possible applications to global nuclear strategy, game theory articles. Nash proved that every finite n-player, non-zero-sum not just 2-player zero-sum non-cooperative game has what is now known as a Nash equilibrium in mixed strategies. Game theory experienced a flurry of activity in the s, during which time the concepts of the corethe extensive form gamefictitious playrepeated gamesand the Shapley value were developed.

In addition, the first applications of game theory to philosophy and political science occurred during this time, game theory articles. In Robert Axelrod tried setting up computer programs as players and found that in tournaments between them the winner was often a simple "tit-for-tat" program that cooperates on the first step, then on subsequent steps just does whatever its opponent did on the previous step.

The same winner was also often obtained by natural selection; a fact widely taken to game theory articles cooperation phenomena in evolutionary biology and the social sciences. InReinhard Selten introduced his solution concept of subgame perfect equilibriawhich further refined the Nash equilibrium later he would introduce trembling hand perfection as well.

In the s, game theory was extensively applied in biologylargely as a result of the work of John Maynard Smith and his evolutionarily stable strategy. In addition, the concepts of correlated game theory articlestrembling hand perfection, and common knowledge [11] were introduced and analyzed. Schelling worked on dynamic models, game theory articles examples of evolutionary game theory.

Aumann contributed more to the equilibrium school, introducing equilibrium coarsening, correlated equilibrium and developing an extensive formal analysis of the assumption of common knowledge and of its consequences. InLeonid Hurwicztogether with Eric Maskin and Roger Myersonwas awarded the Nobel Prize in Economics "for having laid the foundations of mechanism design theory". Myerson's contributions include the notion of proper equilibriumand an important graduate text: Game Theory, Analysis of Conflict.

InAlvin E. Roth and Lloyd S. Shapley were awarded the Nobel Prize in Economics "for the theory of stable allocations and the practice of market design". Inthe Nobel went to game theorist Jean Tirole. A game is cooperative if the players are able to form binding commitments externally enforced e. A game is non-cooperative if players cannot form alliances or if all agreements need to be self-enforcing e. Cooperative games are often analysed through the framework of cooperative game theorywhich focuses on predicting which coalitions will form, the joint actions that groups take and the resulting collective payoffs.

It is opposed to the traditional non-cooperative game theory which focuses on predicting individual players' actions and payoffs and analyzing Nash equilibria. Cooperative game theory provides a high-level approach as it only describes the structure, strategies and payoffs of coalitions, whereas non-cooperative game theory also looks at how bargaining procedures will affect the distribution of payoffs within each coalition. As non-cooperative game theory is more general, cooperative games can be analyzed through the approach of non-cooperative game theory the converse does not hold provided that sufficient assumptions are made to encompass all the possible strategies available to players due to the possibility of external enforcement of cooperation.

While it would thus be optimal to have all games expressed under a non-cooperative framework, in many instances insufficient information is available to accurately model the formal procedures available to the players during the strategic bargaining process, or the resulting model would be of too high complexity to offer a practical tool in the real world.

In such cases, cooperative game theory provides a simplified approach that allows analysis of the game at large without having to make any assumption about bargaining powers. A symmetric game is a game where the payoffs for playing a particular strategy depend game theory articles on the other strategies employed, not on who is playing them.

If the identities of the players can be changed without changing the payoff to the strategies, then game theory articles game is symmetric. The standard representations of chickengame theory articles, the game theory articles dilemmaand the stag hunt are all symmetric games.

Some [ who? However, the most common payoffs for each of these games are symmetric. Most commonly studied asymmetric games are games where there are not identical strategy sets for both players, game theory articles.

For instance, the ultimatum game and similarly the dictator game have different strategies for each player. It is possible, however, for a game to have identical strategies for both players, yet be asymmetric. For example, the game pictured to the right is asymmetric despite having identical strategy sets for both players. Zero-sum games are a special case of constant-sum games, in which choices by players can neither increase nor decrease the available resources.

In zero-sum games the total benefit to all players in the game, for every combination of strategies, always adds to zero more informally, a player benefits only at the equal expense of others, game theory articles.

Other zero-sum games include matching pennies and most classical board games including Go and chess. Many games studied by game theorists including the famed prisoner's dilemma are non-zero-sum games, because the outcome has net results greater or less than zero.

Informally, in non-zero-sum games, a gain by one player does not necessarily correspond with a loss by another. Constant-sum games correspond to activities like theft and gambling, but not to the fundamental economic situation in which there are potential gains from trade. It is possible to transform any game into a possibly asymmetric zero-sum game by adding a dummy player often game theory articles "the board" whose losses compensate the players' net winnings.

Simultaneous games are games where both players move simultaneously, or if they do not move simultaneously, the later players are unaware of the earlier players' actions making them effectively simultaneous. Sequential games or dynamic games are games where later players have some knowledge about earlier actions. This need not be perfect information about every action of earlier players; it might be very little knowledge. The difference between simultaneous and sequential games is captured in the different representations discussed above.

Often, normal form is used to represent simultaneous games, while extensive form is used to represent sequential ones. The transformation of extensive to normal form is one way, meaning that multiple extensive form games correspond to the same normal form. Consequently, notions of equilibrium for simultaneous games are insufficient for reasoning about sequential games; see subgame perfection.

An important subset of sequential games consists of games of perfect information, game theory articles. A game is one game theory articles perfect information if all players know the moves previously made by all other players.

Most games studied in game theory are imperfect-information games. Many card games are games of imperfect information, such as poker and bridge. Games of incomplete information can be reduced, however, to games of imperfect information by introducing " moves by nature ".

Games in which the difficulty of finding an optimal strategy stems from the multiplicity of possible moves are called combinatorial games. Examples include chess and go. Games that involve imperfect information may also have a strong combinatorial character, for instance backgammon. There is no unified theory addressing combinatorial elements in games. There are, however, game theory articles, mathematical tools that can solve particular problems and answer general questions.

Games of perfect information have been studied in combinatorial game theorywhich has developed novel representations, e. These methods address games with higher combinatorial complexity than those usually considered in traditional or "economic" game theory.

A related field of study, drawing from computational complexity theoryis game complexitywhich is concerned with estimating the computational difficulty of finding optimal strategies. Research in artificial intelligence has addressed both perfect and imperfect information games that have very complex combinatorial structures like chess, go, game theory articles, or backgammon for which no provable optimal strategies have been found. The practical solutions involve computational heuristics, like alpha—beta pruning or use of artificial neural networks trained by reinforcement learningwhich make games more tractable in computing practice.

Games, as studied by economists and real-world game players, are generally finished in finitely many moves, game theory articles. Pure mathematicians are not so constrained, and set theorists in particular study games that last for infinitely many moves, with the winner or other payoff not known until after all those moves are completed.

The focus of attention is usually not so much on the best way to play such a game, but whether one player has a winning strategy.

The existence of such strategies, game theory articles, for cleverly designed games, has important consequences in descriptive set theory. Much of game theory is concerned with finite, discrete games, that have a finite number of players, moves, events, outcomes, etc. Game theory articles concepts can be game theory articles, however.

Continuous games allow players to choose a strategy from game theory articles continuous strategy set. For instance, Cournot competition is typically modeled with players' strategies being any non-negative quantities, including fractional quantities.

Differential games such as the continuous pursuit and evasion game are continuous games where the evolution of the players' state variables is governed by differential equations.

The problem of finding an optimal strategy in a differential game is closely related to the optimal control theory. In particular, there are game theory articles types of strategies: the open-loop strategies are game theory articles using the Pontryagin maximum principle while the closed-loop strategies are found using Bellman's Dynamic Game theory articles method. A particular case of differential games are the games with a random time horizon. Therefore, game theory articles, the players maximize the mathematical expectation of the cost function.

 

What exactly is 'game theory'? - BBC News

 

game theory articles

 

Game theory is a technique for analysing how people, firms and governments should behave in strategic situations i.e., in which they must interact with each other, and in deciding what to do must take into account what others are likely to do and how others might respond to what they ezycurtains.ml instance, competition between two firms can be analysed as a game in which firms play to achieve a long. International Journal of Game Theory is devoted to game theory and its applications. It publishes original research making significant contributions from a methodological, conceptual or mathematical point of view. Survey articles may also be considered if especially useful . Game theory, branch of applied mathematics that provides tools for analyzing situations in which parties, called players, make decisions that are interdependent. This interdependence causes each player to consider the other player’s possible decisions, or strategies, in formulating his own.