17 Backward induction ultimatums and bargaining分析和总结分析和总结.docxVIP

Game Theory: Lecture 17 Transcript Overview: We develop a simple model of bargaining, starting from an ultimatum game (one person makes the other a take it or leave it offer), and building up to alternating offer bargaining (where players can make counter-offers). On the way, we introduce discounting: a dollar tomorrow is worth less than a dollar today. We learn that, if players are equally patient, if offers can be in rapid succession, and if each side knows how much the game is worth to the other side, then the first offer is for an equal split of the pie and this offer is accepted. But this result depends on those assumptions; for example, bargaining power may depend on wealth. November 5, 2007 back Professor Ben Polak: So today I want to look at two kinds of games and then well change topic a bit. The games I want to look at are about ultimatums and bargaining. And well start with ultimatums and well move smoothly through, and well see why thats an easy transition in a while. So the game were going to play involves two players, 1 and 2 and the game is this. Player 1 is going to make a take it or leave it offer to Player 2 and this offer is going to concern a pie and lets make the pie worth $1 for now. Well probably play this for real in a bit so well play it for $1. So its a split of a pie, we can think of the split as offering S to Player 1 and (1--S) to Player 2. Player 2 has two choices: 2 can accept this offer, and if 2 accepts the offer then they get exactly the offer. Player 1 gets S and Player 2 gets (1--S). Alternatively, Player 2 can reject, and if Player 2 rejects the offer then both players get 0, both players gets nothing. So a verysimple game, theres a dollar on thetable--Ill take it out in a minute--so theres a dollar on the table, and our two players are going to bargain for this, but it isnt much of a bargain. Player 1s basically going to announce what the divisions going to be. 2 can either accept that division or no one gets anything. Everyone