Game Theory 6
Hi, I only upload professor Stevens book. Next two resources I found over the internet. So you can use those resources or any other resources that you feel are better. Feel free. I just want to pass that horrible class. Write a paper that applies the principles and strategies of game theory to personal and societal issues as well as to current events. The paper should also be a critique of game theory, noting its strengths and weaknesses in application to everyday problems. You may use the following as sources: ● The lectures presented by Professor Scott Stevens ● The two course texts ● Other published works and peer-reviewed sources Use citations from the resources mentioned above, and document all of those sources properly. However, your personal reflections on the subject matter are also important (and required) and should be incorporated throughout the assignment. The paper has two basic divisions. Part I : Game Theory Application The first part of the paper should demonstrate an understanding of basic game theory concepts, including the following: ● Elements of a game ● Types of games ● Types of strategies ● Equilibrium ● The prisoner’s dilemma ● The tragedy of the commons ● Utility When discussing these topics, provide original examples from current events, politics, business, or your personal life. Be sure that among your examples you discuss at least one in another discipline such as history, literature, or psychology. In other words, you should demonstrate that game theory can be applied to a variety of different disciplines. Part 2: Game Theory Analysis In this part of the paper you should analyze how well the concepts of game theory work in daily life. In other words, how can game theory benefit/harm personal and societal relationships and our responses to world events? You do not need to respond to all of the following questions, but you should respond to some of them. They are designed to spark your thinking. 1. What does it mean to choose strategies "rationally" when outcomes depend on the strategies chosen by others and when information is incomplete? 2. In what circumstances is aggression rational and in what circumstances is cooperation rational? 3. How does game theory apply to personal relationships, especially ongoing ones? 4. Can moral rules of cooperation emerge spontaneously from the interactions of rational egoists? 5. What does it mean to be allocentric? How will being allocentric help in your personal and social life? 6. What is the value of flexibility, or of voluntarily giving up flexibility? 7. What does game theory say about cooperation, and do you agree with these ideas?
Game Theory
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Stevens (2008) defines game theory as the study of the study of everyday decision making which is strategic and interactive among rational individuals. He continues on to describe it as the study of mathematical models or co-operation and conflict among the participant members of a decision-making unit or organ. Game theory is mainly used in the subjects of psychology, political science, and economics and in fields of logic and biology. Contemporary applications of the Game theory have expanded to encompass an extended range of relations in behavior and have developed into a term used to describe decision science in both mankind and computers (Holler, 2002). This paper seeks to explore the Game theory and how it applies to personal, societal and to current events and how the theory shapes interactions in society. This paper is organized into two parts with the first part exploring game theory in detail and will discuss some types of games, the features of games and how the theory can be applied to other disciplines of study. The other part of this paper will be an analysis of the concepts of game theory and its application to world events. The second part of this paper will seek to answer some questions concerning game theory and its application to societal and personal relationships and its effect on people's perception to world events.
Game Theory is a model or guide through which one can use as a guide to understand the decision making of others in response to other peoples actions that have already been done or those about to be undertaken (Holler, 2002). He argues that when people make such decisions, they are playing a game. The concept of Game Theory will help in the identification of potential problem areas in such diverse fields as political, personal or even work related situations. The Theory helps and individual understand the characteristics of the game being played and, therefore, aids him in playing it better. Additionally, if an individual encounters a dangerous game, the individual will be in a more stable position to avoid such games entirely. Holler argues that the theory can be applied in a wide range of interactions between members of society. It aids in setting up the terms of interaction between such members and the rules by which such interactions occur (Holler, 2002).
Stevens (2002) argues that the game theory is an educational field that is still in development. Stevens argues that the origins of modern Game Theory can be traced back to 1944 when they published the titled Theory of Games and Economic Behavior was written and published by John Von Neumann and Oskar Morgenstern. The two tutors sought to incorporate ideas from the old economic concepts into a new framework. While older concepts of economics were able to describe market outcomes, it did not consider the actions of individuals as being important. Stevens argues that the game theory, on the other hand, incorporates the decisions of individuals and shows how such decisions matter. The modern Game Theory has its roots in emergent ideas of combined strategy equilibria and the zero-sum games conducted by two people (Stevens, 2008). John Von Neumann, who uses the Brouwer fixed-point theorem and continuously mapped them into convex sets, proposed this concept. This became the standard method of mathematical economics and of the game theory.
Game theory was developed extensively in the 1950's. Later, its applications were extended to other fields of study and used as an important tool in these fields. Game Theory was initially used in economics to explore large collections of behaviors linked to the economy. These behaviors were from sector players such as firms, markets as well as consumers (Holler, 2002). The use of this theory in the social sciences has been extended, and game theory has found applications in political, psychological as well as sociological behaviors. Holler points out that in the field of biology, the use of game theory in the analysis of biological issues began in the 1930's by Ronal Fisher. He argues that although this predates the term "game theory," the concepts shared in the two fields are similar. Concepts of the theory were later widely applied in the field of biology by John Maynard Smith in his book titled Evolution and the Theory of Games. Game Theory has been applied in the fields of economics and philosophy in order to understand a behavior as either being good or proper. Such arguments about game theory can be found in early periods as far back as the days of Plato (Holler, 2002).
Game theory is a young field of study and is under study yet to attain completion. While huge milestones have been achieved in this field, there are some limitations as to the application of the theory in everyday life. The theory assumes that players in such games are inherently rational and that such players will act on the premises of their knowledge and beliefs when pursuing their desires. Such an assumption has some flaws in that in certain situations, the behaviors of individuals may differ in a large way. This unpredictability makes the application of game theories somewhat tricky and unreliable.
Game theory has many elements that must be present for the gaming event to occur. Players must be present in the game. The players are decision makers in the game; they decide where to apply certain strategies and what choices to make. Actions may also be included in the game; actions in this case represent the choices that are available to the player. Such choices involve, for example, in a social setting whether to make a decision to buy stocks or not. Another element that must be present is information. Information is the knowledge that the subject has in making decisions (Holler, 2002). In the example of stocks, such information involves market reports and analysis. The trader in this case will use such information to aid in making a decision. Strategies are an important element of every game. Without strategies, the player will have no rules governing the actions of the player at every point in the game. In every game, outcomes must result because of the actions taken in the game. Outcomes in this case are the results of action of making an investment either a profit or loss. These outcomes are achieved with the result of payoffs. Payoffs are the Utilities that such a stockbroker receives if the stocks appreciate. Equilibrium is the final element of the game theory. Equilibrium refers to a stable result. The results achieved are not always good.
A strategy in game theory refers to a decision that a player will take when confronted with different situations (Stevens, 2008). According to this definition, game strategies can be any number and is only dependent on the situation a player finds themselves in. for example, when selling a product, the buyer will have only two strategies. They can either buy or sell but if the seller floats two different prices for the same product, then the buyers' strategies become four; they can either buy or not at a higher price or choose to buy or not at the lower price. Strategies are the most significant aspects of the game. Strategies are a complete set of actions that the player uses throughout the game. It helps the player in the management of the situation one finds themselves in. The theory has two types of strategies, which include the pure strategy, which is a list of all methods to be employed by the players. It is an analysis of every move a player will take. It stipulates the advantages or disadvantages of such moves to the player. Another type of strategy is a mixed strategy. Mixed strategies provide a counter against all the pure moves. Mixed strategies describe every move offered by pure strategies. It enables players to select moves provided for by the mixed strategies to counter the moves of the pure.
There are several types of games as stipulated by game theory (Stevens, 2008). The first game type discussed will be a cooperative game. A cooperative game is a game in which the players are able to form agreements that bind them to their promises. For instance, a stock trader has to adhere to the terms agreed to by the stock market and other traders. The law requires him to do this. Steven argues that in cooperative games, communications among players are allowed but not in non-cooperative games. He continues on to state that cooperative games focus on the overall game at large, non-cooperative games, on the other hand, is able to focus on details to the finest detail. The Nash equilibrium has however linked many of the cooperative solutions as non-cooperative equillibria.
The second type of game is the symmetric and asymmetric game type. In this type, payoffs, which are acquired, depend on the particular strategies employed and not on the players themselves. A game is symmetric if the identities of the players in the...