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Problem Set 3 Solutions

Problem Set 3 Solutions - Consider the 2012 presidential...

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Unformatted text preview: Consider the 2012 presidential election game we considered in class between the (R)epublicans, (D)emocrats, and, (T)ea Partiers. Make the following added assumption to the game. Assume that each party earns an additional 0.1 payoff when they vote sincerely for their first choice candidate, even if that candidate loses. Under this assumption, find any and all Nash Equilibria. Recall: -We assumed each party votes as a block. (Strong Assumption) -The electorate is divided as Republicans 44%, Democrats 46%, Tea Partiers 10%. -Orders of Preference -- R: Whitman, Palin, Obama -- D: Obama, Whitman, Palin -- T: Palin, Whitman, Obama - Each Party gets a payoff of 2 if their top choice wins. 1 if their 2nd choice wins, and 0 if their last choice wins. Added assumption for this homework: add 0.1 to above payoffs when the party votes sincerely. Example: Say R votes W, D votes O, and T votes P. Then the payoffs are (0.1, 2.1, 0.1) because Obama wins and each party votes sincerely. Say the votes are (W,O,W) then the payoffs are (2.1, 1.1, 1) because Whitman wins and only the Tea Party votes insincerely. ...
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