From: https://oyc.yale.edu/economics/econ-159
Lecture 1: First Five Lessons
Strictly dominate: Strategy alpha strictly dominates strategy beta when the payoff from alpha is strictly greater than that of beta regardless of what others do.
Lesson 1: Never play a strictly dominated game. Lesson 2: Rational play can lead to bad outcomes. Lesson 3: To decide what action to choose, figure out what your payoffs are and what the payoffs of the other players are. Lesson 4: Put yourself in your opponent’s shoes. Lesson 5: Yale students are evil :).
My prediction for the last game: 18. Rationale: You should always be 2/3 of everybody else. But everyone knows that you’ll try to be 2/3 of them, so they’ll go down by a third as well. I think most people will do this 2-3 times and then stop once they’re satisfied that they’re ahead of everyone else.
Lecture 2: Putting Yourself into Other People’s Shoes
Weakly dominate: strategy a weakly dominates b if no matter what others choose, (the payoffs from a() >= (the payoffs from b), and a > b at least once.
Common Knowledge: “I know that you know that I know that you know”… forever.
Lesson 6 (Not a real lesson) : Don’t underestimate the rationality of Yale students :). They went down a lot further than I thought they would.
Ingredients of a game:
- players
- strategies
- payoffs
Notation:
- players: i
- strategies:
- Set of all possible strategies of player i: S (subscript)i
- A particular strategy of player i: s (subscript)i
- A particular play of the game: s
- payoffs:
- U (subscript)i