Games, Strategy and Information

Code:

2ECON02

Acronym:

TJI

Keywords
Classification	Keyword
CNAEF	Economics

Instance: 2015/2016 - 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	61	Bologna Syllabus	1	-	7,5	56	202,5

Teaching language

Portuguese

Objectives

The course offers an introduction to game theory, and aims at studying the issues like strategic interactionanddifferentiated information, and their influenceon individual behaviorandmarket equilibrium. Concepts such as strategy, dominance, equilibrium, competition versus cooperation, strategic movements, backward induction, credibility, leadership, asymmetric information, auctions and signalling are studied.

The course aims to develop students’ strategic thinking by using examples from industrial organization, finance, macroeconomics, labour economics, spatial economics, negotiation, education, marketing, politics, conflicts between nations, sociology, and elsewhere.

Learning outcomes and competences

To understand the issue of strategic interaction among economic agents.

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. Representation of a game of incomplete information
3.3. Bayes-Nash equilibrium
3.4. The revelation principle
3.5. Applications

4. Dynamic games of incomplete information

Mandatory literature

Gibbons, Robert; A Primer in Game Theory, Harvester Wheatsheaf, 1992. ISBN: 0-7450-1159-4

Complementary Bibliography

Rasmusen, Eric; Games and information : an introduction to game theory, Oxford : Blackwell, 2002. ISBN: 0-631-21095-4
Dutta Prajit K.; Strategies and games : theory and practice, MIT Press, 1999. ISBN: 0-262-04169-3
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

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	30,00
Total:	100,00

Calculation formula of final grade

In the regular evaluation, the final grade is the weighted average between problems sets (30%) (average of the three best grades in a set of 4 problem sets) and a final exam (70%) (minimum grade of 6,0 points).

Alternatively, the student may do a final exam.