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Game Theory 2017/2018

  • 5 ECTS
  • Taught in Portuguese
  • Continuous Assessment

Objectives

At the end of the Curricular Unit, the student should be able to:
- Understand the decisions of different economic agents when they are interacting strategically with the decisions of all other participants in a given game, in a static context with complete information.
- Understand the decisions of different economic agents when they are interacting strategically with the decisions of all other participants in a given game, in a dynamic context with complete information.
- Question the theoretical basis of Economics, in light of the scientific method of Experimental Economics.
- Understand the decisions of different economic agents when they are interacting strategically with the decisions of all other participants in a given game, in a static context with incomplete information.
- Adapt the strategic nature of the interaction between different players to the economic, entrepreneurial and “daily” context.

Recommended Prerequisites

Industrial Economics

Teaching Metodology

Expositive Method
Questioning Method
Gamification Method
Flipped Classroom Method

Body of Work

1. Static Games with Complete Information and Nash Equilibrium
1.1 Normal Form: Players, Strategies and Payoffs
1.2 Dominant Strategies Equilibrium
1.3 Nash Equilibrium
1.4 Mixed Strategies

2. Dynamic Games of Complete Information and Subgame Perfect Equilibrium
2.1 Extensive Form: Decision Trees
2.2 Nash Equilibrium and Backward Induction
2.3 Threats and Credible Threats
2.4 Subgames and Subgame Perfect Equilibrium
2.5 Repeated Games: Finite Games
2.6 Infinite Games and the Folk Theorem

3. Experimental Economics and Game Theory

4. Games of Imperfect Information
4.1 Static Bayesian Games and Nash-Bayesian Equilibrium
4.2 Mixed Strategies and Imperfect Information
4.3 The Revelation Principle
4.4 Bayesian Perfect Equilibrium
4.5 Signalling Games and Adverse Selection

Recommended Bibliography

Gibbons, Robert; A Primer in Game Theory. Harvester Wheatsheaf, 1992.
Harrington, Joseph; Games, Strategies and Decision Making, second edition. Freeman/Worth, 2014.
Osborne, Martin; An Introduction to Game Theory, International Edition. Oxford University Press, 2009.

Complementary Bibliography

Tadelis, Steven; Game Theory: An Introduction, Princeton University Press, 2013.
Barron, Emmanuel; Game Theory: An Introduction, Second Edition. Wiley, 2013.

Weekly Planning

1
1.1 Normal Form: Players, Strategies and Payoffs
2
1.2 Dominant Strategies Equilibrium
3
1.3 Nash Equilibrium
4
1.4 Mixed Strategies
5
2.1 Extensive Form: Decision Trees
2.2 Nash Equilibrium and Backward Induction
6
2.3 Threats and Credible Threats
2.4 Subgames and Subgame Perfect Equilibrium
7
2.5 Repeated Games: Finite Games
2.6 Infinite Games and the Folk Theorem
8
3 Experimental Economics and Game Theory
9
3 Experimental Economics and Game Theory
10
4.1 Static Bayesian Games and Nash-Bayesian Equilibrium
4.2 Mixed Strategies and Imperfect Information
11
4.3 The Revelation Principle
12
4.4 Bayesian Perfect Equilibrium
13
4.5 Signalling Games and Adverse Selection
14
Revision of contents for the first test.
First Test
15
Elaboration and presentation of the Essays

Demonstration of the syllabus coherence with the curricular unit's objectives

The syllabus was drawn to attend to the Curricular unit’s objectives. The first objective is attained through the explanation of the contents in Chapter 1. Similarly, the second objective is explained using the contents in Chapter 2. The prossecution of the third objective is satisfied through the contents lectured in Chapter 3. The fourth objective is attained through the learning of the contents lectured in chapter 4, while the fifth objective is attained with all the contents of the curricular unit.

Demonstration of the teaching methodologies coherence with the curricular unit's objectives

With the expositive method the goal is to give a first explanation of the contents. Given the applicability of the contents to practical exercises and to the “real world”, with the questioning methodology the teacher is able to understand whether the student met the objectives while the contents are explained. With gamification, we expect the students to be in a situation in which they have to take strategic decisions against other students, allowing the obtention of knowledge in a more practical manner. With the flipped classroom method, the students will review the contents at the end of each chapter with the Kahoot platform, in which afterwards they will have to defend the option they chose in front of all the class.

relevant generic skillimproved?assessed?
Achieving practical application of theoretical knowledgeYesYes
Adapting to new situationsYesYes
Analytical and synthetic skillsYesYes
Balanced decision makingYesYes
Bargaining abilityYesYes
Commitment to effectivenessYesYes
Commitment to qualityYesYes
CreativityYesYes
Information and learning managementYesYes
IT and technology proficiencyYesYes
Problem Analysis and AssessmentYesYes
Problem-solvingYesYes
Relating to othersYesYes
Research skillsYesYes
Self-assessmentYesYes
TeamworkYesYes
Written and verbal communications skillsYesYes
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