Game Theory / Edition 1

by Drew Fudenberg, Jean Tirole

Overview

This advanced text introduces the principles of noncooperative game theory in a direct and uncomplicated style that will acquaint students with the broad spectrum of the field while highlighting and explaining what they need to know at any given point.

This advanced text introduces the principles of noncooperative game theory—including strategic form games, Nash equilibria, subgame perfection, repeated games, and games of incomplete information—in a direct and uncomplicated style that will acquaint students with the broad spectrum of the field while highlighting and explaining what they need to know at any given point. The analytic material is accompanied by many applications, examples, and exercises. The theory of noncooperative games studies the behavior of agents in any situation where each agent's optimal choice may depend on a forecast of the opponents' choices. "Noncooperative" refers to choices that are based on the participant's perceived selfinterest. Although game theory has been applied to many fields, Fudenberg and Tirole focus on the kinds of game theory that have been most useful in the study of economic problems. They also include some applications to political science. The fourteen chapters are grouped in parts that cover static games of complete information, dynamic games of complete information, static games of incomplete information, dynamic games of incomplete information, and advanced topics.

Product Details

ISBN-13:	9780262061414
Publisher:	MIT Press
Publication date:	08/29/1991
Series:	The MIT Press
Edition description:	New Edition
Pages:	604
Sales rank:	544,331
Product dimensions:	7.25(w) x 10.25(h) x 1.64(d)
Age Range:	18 Years

About the Author

Drew Fudenberg is Professor of Economics at MIT.

Jean Tirole, the 2014 Nobel Laureate in Economics, is Scientific Director of IDEI (Institut d'Economie Industrielle), Chairman of the Board of TSE (Toulouse School of Economics), and Annual Visiting Professor of Economics at MIT.

Table of Contents

(EXercises and References close each chapter)
Static Games of Complete Information
1 Games in Strategic Form and Nash Equilibrium
1.1 Introduction to Games n Strategic Form and Iterated Strict
Dominance
1.2 Nash Equilibrium
1.3 EXistence and Properties of Nash Equilibria
2 Iterated Strict Dominance, Rationalizability, and Correlated
Equilibrium
2.1 Iterated Strict Dominance and Rationalizability
2.2 Correlated Equilibrium
2.3 Rationalizability and Subjective Correlated Equilibria
Dynamic Games of Complete Information
3 EXtensiveForm Games
3.1 Introduction
3.2 Commitment and Perfection in MultiStage Games with Observed
Actions
3.3 The EXtensive Form
3.4 Strategies and Equilibria in EXtensiveForm Games
3.5 Backward Induction and Subgame Perfection
3.6 Critiques of Backward Induction and Subgame Perfection
4 Applications of MultiStage Games with Observed Actions
4.1 Introduction
4.2 The Principles of Optimality and Subgame Perfection
4.3 A First Look at Repeated Games
4.4. The RubinsteinStahl Bargaining Model
4.5 Simple Timing Games
4.6 Iterated Conditional Dominance and the Rubinstein Bargaining
Game
4.7 OpenLoop and ClosedLoop Equilibria
4.8 FiniteHorizon and InfiniteHorizon Equilibria
5 Repeated Games
5.1 Repeated Games with Observable Actions
5.2 Finite Repeated Games
5.3 Repeated Games with Varying Opponents
5.4 Pareto Perfection and RenegotiationProofness in Repeated Games
5.5 Repeated Games with Imperfect Public Information
5.6 The Folk Theorem with Imperfect Public Information
5.7 Changing the Information Structure with the Time Period
Static Games of IncompleteInformation
6 Bayseian Games and Bayseian Equilibrium
6.1 Incomplete Information
6.2 EXample 6.1: Providing a Public Good under Incomplete
Information
6.3 The Notions of Type and Strategy
6.4 Bayesian Equilibrium
6.5 Further EXamples of Bayesian Equilibria
6.6 Deletion of Strictly Dominated Strategies
6.7 Using Bayesian Equilibria to Justify MiXed Equilibria
6.8 The Distributional Approach
7 Bayesian Games and Mechanism Design
7.1 EXamples of Mechanism Design
7.2 Mechanism Design and the Revelation Principle
7.3 Revelation Design with a Single Agent
7.4 Mechanisms with Several Agents: Feasible Allocations, Budget
Balance, and Efficiency
7.5 Mechanism Design with Several Agents: Optimization
7.6 Further Topics in Mechanism Design
AppendiX
Dynamic Games of Incomplete Information
8 Equilibrium Refinements: Perfect Bayesian Equilibrium,
Sequential Equilibrium, and TremblingHand Perfection
8.1 Introduction
8.2 Perfect Bayesian Equilibrium in MultiStage Games of Incomplete
Information
8.3 EXtensiveForm Refinements
8.4 Strategicform Refinements
AppendiX
9 Reputation Effects
9.1 Introduction
9.2 Games with Single LongRun Player
9.3 Games with many LongRun Players
9.4 A Single "Big" Player Against Many Simultaneous LongLived
Opponents
10 Sequential Bargaining under Incomplete Information
10.1 Introduction
10.2 Intertemporal Price Discrimination: The SingleSale Model
10.3 Intertemporal Price Discrimination: The Rental or RepeatedSale
Model
10.4 Price Offers by an Informed Buyer
Advanced Topics
11 More Equilibrium Refinements: Stability, Forward Induction,
and Iterated Weak Dominance
11.1 Strategic Stability
11.2 Signaling Courses
11.3 Forward Induction, Iterated Weak Dominance, and "Burning Money"
11.4 Robust Predictions under Payoff Uncertainty
12 Advanced Topics in StrategicForm Games
12.1 Generic Properties of Nash Equilibria
12.2 EXistence of Nash Equilibrium in Games with Continuous Action
Spaces and Discontinuous Payoffs
12.3 Supermodular Games
13 PayoffRelevant Strategies and Markov Equilibrium
13.1 Markov Equilibria in Specific Cases of Games
13.2 Markov Perfect Equilibrium in General Games: Definitions and
Properties
13.3 Differential Games
13.4 CapitalAccumulation Games
14 Common Knowledge Games
14.1 Introduction
14.2 Knowledge and Common Knowledge
14.3 Common Knowledge and Equilibrium
14.4 Common Knowledge, Almost Common Knowledge, and the Sensitivity of
the Equilibria to the Information Structure
IndeX

What People are Saying About This

Charles Wilson

Fudenberg and Tirole's text will have an immediate and important impact on the way game theory is taught at the graduate level. Not only does it cover most of the central topics in noncooperative game theory, it is as up-to-date and complete as a book in this area could hope to be.

Ken Binmore

Game Theory is the book to read if you want to be published in Econometrica.

Robert Wilson

Game Theory by Fudenberg and Tirole provides a comprehensive and precise exposition of the theory and the main applied topics, plus challenging exercises conveying the key ideas from a wide literature. The treatments of dynamics and incomplete information unify developments of the 1980s. This book will be a standard text and reference.

David Kreps

Both broad and deep, this book belongs on the shelf of every serious student of game theory.

Endorsement

Fudenberg and Tirole's text will have an immediate and important impact on the way game theory is taught at the graduate level. Not only does it cover most of the central topics in noncooperative game theory, it is as up-to-date and complete as a book in this area could hope to be.

—Charles Wilson, Professor of Economics, New York University

From the Publisher

Game Theory by Fudenberg and Tirole provides a comprehensive and precise exposition of the theory and the main applied topics, plus challenging exercises conveying the key ideas from a wide literature. The treatments of dynamics and incomplete information unify developments of the 1980s. This book will be a standard text and reference.

—Robert Wilson, Professor, Graduate School of Business, Stanford University

Both broad and deep, this book belongs on the shelf of every serious student of game theory.

—David Kreps, Graduate School of Business, Stanford University

Game Theory is the book to read if you want to be published in Econometrica.

—Ken Binmore, Professor of Economics, University of Michigan and University College London

Fudenberg and Tirole's text will have an immediate and important impact on the way game theory is taught at the graduate level. Not only does it cover most of the central topics in noncooperative game theory, it is as up-to-date and complete as a book in this area could hope to be.

—Charles Wilson, Professor of Economics, New York University