Game Theory

Abstract

Game theory is the mathematical study of situations of conflict of interest. Thus a game is any situation in which two or more players, not having identical interest, can affect the outcome. Games can be represented in either extensive form—a logical listing of the sequence of moves and positions of the game—or in normal form—a listing of the players' possible strategies, together with the outcomes associated with each choice of strategies. Games can be characterized as zero-sum or non-zero-sum; as cooperative or noncooperative; as having complete or incomplete information. In noncooperative games the emphasis is in the search for strategies which are in equilibrium or which are, in some sense, good. In cooperative games, the emphasis is on the process of bargaining and coalition formation. In games with incomplete information, the question of learning is also of importance.