Lecture 13: Game Theory and Strategic Play

These flashcards cover key terms and definitions relating to game theory and strategic play as discussed in the lecture.

Game Theory

The study of strategic interactions among rational decision-makers.

Nash Equilibrium

A situation where each player's strategy is optimal given the strategies of other players, implying that no player can benefit by unilaterally changing their strategy.

Simultaneous Move Games

Games in which all players choose their strategies at the same time, without knowledge of the others' choices.

Dominant Strategy

A strategy that is the best for a player regardless of what the other players choose.

Prisoners’ Dilemma

A standard example of a game theory scenario where two players might not cooperate even if it is in their best interest to do so.

Payoff Matrix

A table that describes the payoffs received by each player for every possible combination of strategies they can choose.

Extensive-Form Games

Games where players make decisions in sequence rather than simultaneously.

Zero-Sum Game

A type of game in which one player's gain is exactly balanced by the losses of other players.

First-Mover Advantage

The advantage gained by the first player to act in a game, allowing them to set terms that benefit them.

Backward Induction

A method used in game theory to determine optimal strategies by analyzing the game's end and reasoning backward.