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An Introduction to Applicable Game Theory

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  • Robert Gibbons

Abstract

This paper offers an introduction to game theory for applied economists. The author gives simple definitions and intuitive examples of four kinds of games and their corresponding solution concepts: Nash equilibrium in static games of complete information; subgame-perfect Nash equilibrium in dynamic games of complete information; Bayesian Nash equilibrium in static games with incomplete (or 'private') information; and perfect Bayesian (or sequential) equilibrium in dynamic games with incomplete information. The main theme of the paper is that there are important differences among the games but important similarities among the solution concepts.

Suggested Citation

  • Robert Gibbons, 1997. "An Introduction to Applicable Game Theory," Journal of Economic Perspectives, American Economic Association, vol. 11(1), pages 127-149, Winter.
  • Handle: RePEc:aea:jecper:v:11:y:1997:i:1:p:127-49
    Note: DOI: 10.1257/jep.11.1.127
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    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General

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