game theory flash cards

Strategic Reasoning

Predicting other agents' actions, unlike parametric reasoning which deals with passive objects.

Parametric Reasoning

A type of reasoning that involves passive objects, such as rocks, rather than predicting actions of agents.

Agents

Entities like humans, corporations, or animals that act rationally to satisfy their preferences.

Rationality

The principle that agents aim for outcomes that best satisfy their preferences.

Sequential Play

A type of play where one player has the advantage of perfect information.

Simultaneous Play

A type of play where players make decisions without knowing the other players' actions.

Prisoner's Dilemma

A game illustrating how two rational individuals may fail to cooperate even when it is in their best interest.

Utility Functions

Payoffs that can be ranked either ordinally (relative preference) or cardinally (magnitude of preference).

Nash Equilibrium

A state in which no player can improve their outcome by changing strategies alone.

Dominance

A strategy that yields a better outcome regardless of what the other player does.

Pareto Optimality

A situation where no one can be made better off without making someone else worse off.

Assurance Games

Games where players choose between payoff-dominant and risk-dominant strategies.

Repeated Games

Games involving multiple rounds where players base decisions on prior actions.

Tit-for-tat

A strategy in repeated games where a player mimics the opponent's previous action.

Grim Strategy

A strategy in repeated games that involves cooperating until the opponent defects, after which the player defects forever.

Coordination Games

Games where players must align strategies for mutual benefit, often involving social norms or brinkmanship.

Pure Coordination

Games with no preference for any particular equilibrium.

Impure Coordination

Games with conflicting preferences that require negotiation or risk.

Hobbesian Political Authority

The concept that in the "state of nature," no political authority exists, leading to a state of war.

Game-Theoretic Representation

Modeling the "state of nature" as a prisoner's dilemma where agents fail to cooperate without external authority.

Political Authority and Payoff Matrix

The role of government in changing the payoff structure to compel compliance with covenants.