Games, Strategy and Information

Code:

2ECON02

Acronym:

TJI

Keywords
Classification	Keyword
CNAEF	Economics

Instance: 2019/2020 - 1S

Active?	Yes
Responsible unit:	Agrupamento Científico de Economia
Course/CS Responsible:	Master in Economics

Cycles of Study/Courses

Acronym	No. of Students	Study Plan	Curricular Years	Credits UCN	Credits ECTS	Contact hours	Total Time
ME	77	Bologna Syllabus	1	-	7,5	56	202,5

Teaching language

Português/English (horários/schedules: ME1 e ME2, Português; ME3 English

Objectives

The focus of economic science as evolved along the past decades. Among the new issues are asymmetric information, market design, the role of institutions, and social choice.
Aware of the challenges, the course has two dimensions. The first is instrumental, and offers a rigorous introduction to game theory. The goal is to supply students with the tools needed to analyze the new problems. The second dimension aims at applying these tools to issues like:
(1)    Strategic interaction and its impact on individual behavior.
(2)    Negotiation and decision-making.
(3)    Adverse selection and non-monetary incentives.
(4)    The details of each market and how to improve their efficiency.
(5)    The role of institutions and social choices.

Learning outcomes and competences

Students ought to master the above mentioned scientific goals, and be able to apply game theoretical tools to practical problems. Students will develop skills in the following areas:
(1)    Interpreting and processing economic information, as well as oral and written communication.
(2)    Critical thinking in the acquisition of new knowledge, and logical thinking in problem solving and decision-making.
(3)    Planning tasks and teamwork.
(4)    Ethics: students should incorporate ethical and professional principles into their behavior.
(5)    Developing students' strategic reasoning.
(6)    Improving students' critical thinking through the study of practical examples from industrial organization, finance, macroeconomics, labor economics, spatial economics, trade, education, marketing, politics, conflicts between nations, sociology, etc.

Working method

Presencial

Program

1. Static games of complete information and Nash equilibrium
1.1. Static games and Nash equilibrium
1.2. Applications
1.3. Mixed strategies
2. Dynamic games of complete information and subgame perfect equilibrium
2.1. Dynamic games of complete and perfect information
2.2. Applications
2.3. Dynamic games of complete and imperfect information
3. Static games of incomplete information
3.1. Incomplete and imperfect information
3.2. Bayes-Nash equilibrium
3.3. Applications
3.4. Mechanisms design and public choice
4. Dynamic games of incomplete information
4.1. Definition
4.2. Perfect Bayesian equilibrium
4.3. Applications

Mandatory literature

José Jorge, Isabel Mota, Paula Sarmento; Jogos, Estratégia e Informação, Escolar Editora, 2016

Complementary Bibliography

Gibbons, Robert; A Primer in Game Theory, Harvester Wheatsheaf, 1992. ISBN: 0-7450-1159-4
Dixit, A. K. and B. J. Nalebuff; Thinking Strategically, Norton, 1993
John McMillan; Games, strategies and managers: how managers can use game theory to make better business decision, Oxford University Press, 1996. ISBN: 978-0-19-510603-3
McMillan, John; Reinventing the bazaar. ISBN: 978-0-393-32371-9
Dutta Prajit K.; Strategies and games : theory and practice, MIT Press, 1999. ISBN: 0-262-04169-3
Rasmusen, Eric; Games and information : an introduction to game theory, Oxford : Blackwell, 2002. ISBN: 0-631-21095-4

Teaching methods and learning activities

Theorethical and pratical classes. In addition to the development of theoretical models and resolution of exercises, there are also presented case studies and applications.

Evaluation Type

Distributed evaluation with final exam

Assessment Components

Designation	Weight (%)
Exame	70,00
Trabalho escrito	25,00
Trabalho prático ou de projeto	5,00
Total:	100,00

Amount of time allocated to each course unit

Designation	Time (hours)
Elaboração de projeto	1,50
Estudo autónomo	160,50
Frequência das aulas	40,50
Total:	202,50

Eligibility for exams

Not applicable.

Calculation formula of final grade

In the distributed evaluation, students will be assessed by the resolution of problem sets (25%) (average of the two best grades in a set of 3 problem sets), teamwork (5%) and a final exam (to choose between the first or the second season) (70%) (minimum grade of 6,0 points).

Final grade (distributed evaluation) = 25% * (average of the two best grades in a set of 3 problem sets) + 5% * teamwork + 70% * final exam

Alternatively, students may do a final exam.

Special assessment (TE, DA, ...)

General assessment regime.

Classification improvement

General assessment regime.

Observations

Horários/schedules: ME1 e ME2, Português; ME3 English