lecture13Dynamic Games of Complete and Perfect Information(博弈论,Carnegie Mellon University).pptVIP

June 5, 2003 73-347 Game Theory--Lecture 13 June 5, 2003 Lecture 13 Dynamic Games of Complete Information Dynamic Games of Complete and Perfect Information Outline of dynamic games of complete information Dynamic games of complete information Extensive-form representation Dynamic games of complete and perfect information Game tree Subgame-perfect Nash equilibrium Backward induction Applications Dynamic games of complete and imperfect information More applications Repeated games Today’s Agenda Review of previous class Subgame Subgame-perfect Nash equilibrium Backward induction Sequential bargaining (2.1.D of Gibbons) Dynamic (or sequential-move) games of complete information A set of players Who moves when and what action choices are available? What do players know when they move? Players’ payoffs are determined by their choices. All these are common knowledge among the players. Dynamic games of complete and perfect information Perfect information All previous moves are observed before the next move is chosen. A player knows Who has moved What before she makes a decision Entry game An incumbent monopolist faces the possibility of entry by a challenger. The challenger may choose to enter or stay out. If the challenger enters, the incumbent can choose either to accommodate or to fight. The payoffs are common knowledge. Strategy and payoff A strategy for a player is a complete plan of actions. It specifies a feasible action for the player in every contingency in which the player might be called on to act. It specifies what the player does at each of her nodes Nash equilibrium in a dynamic game We can also use normal-form to represent a dynamic game The set of Nash equilibria in a dynamic game of complete information is the set of Nash equilibria of its normal-form How to find the Nash equilibria in a dynamic game of complete information Construct the normal-form of the dynamic game of complete information Find the Nash equilibria in the normal-form Entry game Chall