Introduction to Game Theory Economics 171 - Spring 2010 Syllabus Instructor: Zack Grossman grossman[at]econ.ucsb.edu Office: NH 3049 Office Hours: R 12:30-1:30 Course Homepage: http://econ.ucsb.edu/~grossman/Econ171S10Lectures: TR 2 – 3:15, PHELPS 1260 Course Overview and Objectives: In order for a decision-maker to decide how to best behave, she must take into account how other players behave, including how her own behavior influences the thinking and payoffs of others. Game theory is the systematic study of this strategic interaction. It helps us develop an understanding of how people actually behave and how they should be advised to behave in strategic situations. The formal mathematical structure allows us to trace the logical implications of our assumptions. Game theory emphasizes the role of conflicting or shared goals, timing, private information and its manipulation in determining outcomes. It is used by researchers in every area of economics, and increasingly in other sciences such as political science, psychology, sociology, and biology. This course introduces some of the game theory’s main topics and analytic tools, with an emphasis on gaining a practical understanding. Because of the tools-oriented approach, many of the games we analyze will have no obvious economic interpretation. At the end of the course you should be able to formalize a strategic situation as a well-defined game; choose appropriately from a basic kit of analytic tools, called solution concepts, to analyze and solve a wide variety of games and applications; and understand the assumptions underlying these concepts, as well as their strengths and limitations. While the emphasis is on the practical, a solid understanding of game theory requires some mathematical sophistication. You should have some experience with basic probability theory and calculus. More importantly you should be used to thinking analytically and in mathematical terms. Prerequisites: To enroll in this course you must already be accepted in the Economics major. This means that you must have taken Econ 1,2, and 10A, Math3AB, and Pstat5E. Registration The Economics Department Undergraduate Office handles all matters related to dropping or adding the course, wait-lists, etc. Please contact them regarding these issues. You can find a link to sign up for the waitlist on the main Economics Departmenthomepage. During the second week of classes, the Undergraduate office will provide me with a prioritized wait-list and a limited number of access codes. Only then will I be able to admit anyone into the class.
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