Behavioral Game Theory: Experiments in Strategic Interaction
This course is expected to run but has not yet been scheduled.
The purpose of the course is to understand behavior using game theoretic concepts. The course will start with the study of basic concepts of game theory and then will move on to the study of decision making by real people who are not perfectly rational. The course will help students understand how people really interact with each other in daily life using both economic theory and experiments in economics.
The standard game theory asks how rational geniuses play games, but ignored until recently how average people with emotions and limited foresight actually play games. We will learn how emotions like altruism, jealousy, honesty etc. affect behavior. This course introduces decision-making theories and related laboratory experiments in economics. We'll learn why and how economists use controlled experiments to learn about economic behavior.
The games we are going to study include the prisoner's dilemma, the beauty contest game, the public goods game, the bargaining experiments, and the auction games. The introduction of game theory will be covered. We will study behavioral theories and conduct experiments in class to see if we can validate these theories with the experimental data.
This course is mainly for students who are interested in economics, business, political science, and psychology. It provides an easy way to learn game theory so students can have a basic understanding in economics. Also, it provides a thorough introduction to experimental economics so students can start to perform their own research in this field.
By the end of this course, students will know or be able to do the following:
1. Understand basic concepts of game theory-finding Nash equilibrium in simultaneous-move games and sequential-move games.
2. Apply game theoretic concepts to understand behavior of 'real' people.
3. Learn the basics of experimental economics and understand how the experimental results affirm (or differ from) predictions of economic theory.
Basic math knowledge is recommended.