4. Best responses in soccer and business partnerships
Game Theory (ECON 159)
We continue the idea (from last time) of playing a best response to what we believe others will do. More particularly, we develop the idea that you should not play a strategy that is not a best response for any belief about others' choices. We use this idea to analyze taking a penalty kick in soccer. Then we use it to analyze a profit-sharing partnership. Toward the end, we introduce a new notion: Nash Equilibrium.
00:00 - Chapter 1. Best Response: Penalty Kicks in Soccer
15:14 - Chapter 2. Best Response: Issues with the Penalty Kick Model
24:06 - Chapter 3. Best Response: Formal Definition
29:59 - Chapter 4. Externalities and Inefficient Outcomes: The Partnership Game
01:07:23 - Chapter 5. Nash Equilibrium: Preview
Complete course materials are available at the Yale Online website: online.yale.edu
This course was recorded in Fall 2007.