ECON 1108 Lecture Notes - Lecture 7: Subgame Perfect Equilibrium, Nash Equilibrium, Subgame
Document Summary
What the backward induction nash equilibrium is often referred to as. Going to be learning how to put a simultaneous play game into extensive form. A game with 2 or more nodes in one information set is a game of imperfect information. Entry deterrence is a game of perfect information. A strategy is a complete plan of action: a strategy has to tell us what a player does at each place the player plays the game. Equilibrium profile perfect nash equilibrium for finitely repeated prisoner"s dilemma. Selten"s theorem repetitions the solution to the game is the same solution as found in the one-shot game. Folk theorem action pairs is the outcome of some subgame perfect nash equilibrium, if the game has a sufficiently large discount factor outcome of some subgame perfect nash equilibrium. Games such as auctions where for example construction firms bid (submit a positive real) to purchase the rights to part of the electromagnetic spectrum.
