Game Theory

Disciplines: Economics, Political Science

A method for analyzing circumstances in the form of of competitive game models whose outcome for each party is determined by the behavior of the other.

Game theory is largely based on rational decision making processes during which individuals and institutions engage in with the objective of maximizing their interests, and minimizing their costs. Due to the nature of the games, guessing the behavior of the other party through a set of strategic calculations is of utmost importance.

Game theories are usually classified as cooperative/non-cooperative, symmetric/asymmetric, and zero-sum/non-zero-sum, among others.

Examples to most famous game theories include prisoner's dilemma, chicken, and STAG HUNT.

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