Course Details
Subject {L-T-P / C} : HS1350 : Game Theory in Economics { 3-0-0 / 3}
Subject Nature : Theory
Coordinator : Prof. Bikash Ranjan Mishra
Syllabus
Unit – 1
Foundations: Calculus and Optimization Probability and Expectation, Utility and Expected Utility Introduction to Game Theory
Unit – 2
Strategic form Games and Dominant Strategies, Dominance Solvability, Nash Equilibrium, Applications: Cournot Duopoly, Voting and Elections, The Commons Problem Mixed Strategies and Zero-sum Games
Unit – 3
Extensive Form Games and Backward Inductions: Subgame Perfect Equilibrium, Finitely and Infinitely Repeated Games Applications – R&D, Stock Market, OPEC, and Trade Agreements
Unit – 4
Asymmetric Information Games: Moral Hazzard and Incentives Theory, Signalling Games and Lemon Problem
Basics of Dynamic Games and Cooperative Games
Course Objectives
- To assimilate the interconnections between Game Theory and Economics
- To understand and assess the fundamental procedures of rules of the game, forms of the game
- To analyze the applications of game theory principles in Economics and Business
- To comprehend and evaluate the different types of game theory: pure and mixed, cooperative and non-cooperative, static and dynamic
Course Outcomes
On successful completion of the course, students will be able to: <br />1. Identify and understand the rationale of game theory as a mathematical model <br />2. Apply the techniques of game theory in Economics, Business, and Finance <br />3. Assess the importance of different game theoretical applications in understanding fundamentals of Micro and Macroeconomics laws and theories.
Essential Reading
- Dutta Prajit K., and Vergote, W. (2022), Strategies and Games: Theory and Practice, MIT Press
- Watson, J. (2013), Strategies: An Introduction to Game Theory, W. W. Norton
Supplementary Reading
- Osborne M. J. (2004), An Introduction to Game Theory, Oxford University Press
- Romp G. (1997), Game Theory: Introduction and Applications, Oxford University Press