06 Nash equilibrium dating and Cournot分析和总结分析和总结.docxVIP

Game Theory: Lecture 6 Transcript Overview: We apply the notion of Nash Equilibrium, first, to some more coordination games; in particular, the Battle of the Sexes. Then we analyze the classic Cournot model of imperfect competition between firms. We consider the difficulties in colluding in such settings, and we discuss the welfare consequences of the Cournot equilibrium as compared to monopoly and perfect competition. September 24, 2007 back Professor Ben Polak: All right, so last time we were talking about The Investor Game and this was a coordination game, and we learned some things. I just want to recall some of the things we learned so I can highlight them a bit. One thing we learned was that communication can help in a coordination game. So I forget who it was, but someone down here who has disappeared, was our Jimmy Stewart character and helped coordinate you on a better equilibrium simply by suggesting what you should do. There are two lessons here. One is this is very different from the Prisoners Dilemma. So we learned the very first time that in the Prisoners Dilemma communication per se wont help, but in the coordination problem, which could be just as serious socially as a Prisoners Dilemma, in a coordination problem it may well help. The reason it helps is youretrying to coordinate onto a Nash Equilibrium. One way to think about Nash Equilibria is that they are self-enforcing agreements, so provided that everyone believes that everyone is going to go along with this agreement, then everyone in fact will. I want to make another, slightly more philosophical remark associated with this and its to do with the idea of leadership. So leadership is kind of a big word that you see written probably too often these days, in too many newspaper articles, and it probably comes up in too many Yale classes, and I dont claim to know anything about leadership. And I dont think Game Theory is going to contribute to anything to understanding about leadership. But one thin