Game Components
1. Players
2. Strategies
a. Strategic: applies to entire decision
i. Strategy: Covers any possibly playing of the game
ii. Reduction: Change, transform
iii. Pure Strategy: There is no randomness involved
iv. Mixed Strategy: There is random

Game Theory
Dr. Barry Webster
Lecture 4
CONCEPTS
Simultaneous Game: All players move at the
same time, or are at least they are unaware of
the others moves
Atomic Games:
The smallest kind of game (2x2)
Two players, two moves
COORDINATION
First Atomic G

Game Theory
Dr. Barry Webster
Lecture 6
ZERO SUM OR CONSTANT SUM GAMES
Even has more ways to win than Odd
Evens payoff overall is 4
Odds payoff overall is -4
Each cell is not equally likely
The optimal solution is a mixed strategy for both
players wh

Game Theory
Dr. Barry Webster
Lecture 5
CONCEPTS REVIEW
When we do not have a pure strategy we use
probability
If we are using probability and we have one or more
Nash Equilibrium, then we look for the Schelling
Points.
We can apply mixed strategies, w

Game Theory
Dr. Barry Webster
Lecture 3
CONCEPTS REVIEW
Nash Equilibrium: We have a strategy for the
game that is in such a way that no one player
wants to change their move unilaterally
Pareto Optimal: A solution is Pareto Optimal if
no one can do bett

Game Theory
Dr. Barry Webster
Lecture 2
SIMULTANEOUS GAME
Best Solution: Both go formal
Next Solution: Both go casual
Worst Solution: One goes formal and the
other goes casual
If you change the game to sequential, the first
mover has the advantage of

Game Theory
Dr. Barry Webster
Lecture 1
THE WORLD OF GAME THEORY
Game: $100 and the red button
If you press the button, everyone else but you loses $2
However, any losses you suffer are cut in half
What do you do?
Best outcome: Nobody pushes the butto