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Game Theory
Abstract
Economists, political scientists, and military analysts widely apply game theory techniques to analyze strategic decision making of players. The model is often adopted to analyze oligopolistic firms' actions, legal, and political negotiations, dating and mating strategies by couples, and competitive bidding in auctions. As a facet of neuroeconomics, game theory can highly complement the comprehension of human decision making processes. Although the model has been somewhat difficult for many readers, this chapter presents game theory with a high level of precision for easy understanding. The discourse presented in this chapter covers the different types of games, the approaches applied to predict games' outcomes, and general analysis of strategic choices. In its final section, the chapter underscores key aspects of auction and competitive bidding.
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