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Strategy B is weakly dominant if strategy B weakly dominates every other possible strategy. Strategy B is strictly dominated if some other strategy exists that strictly dominates B. Strategy B is weakly dominated if some other strategy exists that weakly dominates B. Strategy: A complete contingent plan for a player in the game. A complete ...
The dominant-strategy revelation-principle says that every social-choice function that can be implemented in dominant-strategies can be implemented by a DSIC mechanism. The Bayesian–Nash revelation-principle says that every social-choice function that can be implemented in Bayesian–Nash equilibrium ( Bayesian game , i.e. game of incomplete ...
A Nash equilibrium is a strategy profile (a strategy profile specifies a strategy for every player, e.g. in the above prisoners' dilemma game (cooperate, defect) specifies that prisoner 1 plays cooperate and prisoner 2 plays defect) in which every strategy played by every agent (agent i) is a best response to every other strategy played by all the other opponents (agents j for every j≠i) .
In applied game theory, the definition of the strategy sets is an important part of the art of making a game simultaneously solvable and meaningful. The game theorist can use knowledge of the overall problem, that is the friction between two or more players, to limit the strategy spaces, and ease the solution.
Behavioral game theory seeks to examine how people's strategic decision-making behavior is shaped by social preferences, social utility and other psychological factors. [1] Behavioral game theory analyzes interactive strategic decisions and behavior using the methods of game theory , [ 2 ] experimental economics , and experimental psychology .
In his paper "Counterspeculation, Auctions, and Competitive Sealed Tenders", William Vickrey showed that if preferences are restricted to the case of quasi-linear utility functions then the mechanism dominant strategy is dominant-strategy implementable. [3] "A social choice rule is dominant strategy incentive compatible, or strategy-proof, if ...
The work of John von Neumann established game theory as its own independent field in the early-to-mid 20th century, with von Neumann publishing his paper On the Theory of Games of Strategy in 1928. [ 10 ] [ 11 ] Von Neumann's original proof used Brouwer's fixed-point theorem on continuous mappings into compact convex sets , which became a ...
The revelation principle is a fundamental result in mechanism design, social choice theory, and game theory which shows it is always possible to design a strategy-resistant implementation of a social decision-making mechanism (such as an electoral system or market). [1] It can be seen as a kind of mirror image to Gibbard's theorem.