A Teaching Topic in Economic Analysis
This topic deals with game theory, which is the general analysis of strategic interaction between individuals. Game theory usually models strategic behaviour by agents who understand that their actions affect the actions of other agents. This topic discusses several different types of "games" that are helpful for understanding and analyzing behaviour.
Core Concepts associated with this Topic: Dominant Strategy; Game Theory; Prisoner's Dilemma; Ultimatum Game.
Topic Learning Outcome: Appropriately utilize and interpret results of applying the principles of game theory to the analysis of public policy and management problems.
Harvard University: API-101 Markets and Market Failure
Robert S. Pindyck and Daniel L. Rubinfeld. 2012. Microeconomics, Eighth Edition. Prentice-Hall. Chapter 12.
Sample Assessment Questions:
1.) What is game theory, and why is it important for the study of economics and public policy?
2.) What is a mixed-strategy game?
3.) What is the prisoner's dilemma? Explain the importance of this concept in the field of public management using at least one example.
4.) Why is imperfect information sometimes a cause of market failure?
Page updated by Sean Goertzen and Ben Eisen on 21 May 2015.