An Introduction to Game Theory

About The Course

Game theory is the study of strategic decision making. It acquires relevance whenever multiple individuals are involved in a decision. Strategic thinking then acquires relevance. Individual decisions cannot be made without careful consideration of others’ actions. Game theory offers a framework for analyzing such decisions. We will study the fundamentals of game theory using examples and illustrations. Game theory has found its most widespread use in economics. But other disciplines like political science and biology also apply game theoretic thinking. We will consider some such applications. A profound implication of game theory is that despite best efforts, a society or a group of people can get trapped in a harmful outcome. Examples of such detrimental consequences include environmental pollution, arms race between countries and harmful price competition between firms. We will try to understand why such paradoxes emerge and attempt to understand how to overcome them.