Exam #2 Flashcards
(47 cards)
What is the difference between Sequential and Simultaneous Games?
Sequential games involve players making decisions one after another, while simultaneous games involve players making decisions at the same time.
What is the difference between Action and Strategy?
Action refers to a specific move made by a player, while strategy is a comprehensive plan that outlines a player’s actions in response to potential moves by others.
What is a Best Response?
A Best Response is the strategy that yields the highest payoff for a player, given the strategies chosen by other players.
Define Nash Equilibrium.
Nash Equilibrium is the point where no player can benefit from changing their strategy while the other players keep theirs unchanged.
What are Pure and Mixed Strategies?
Pure strategies involve making a specific choice 100% of the time, while mixed strategies involve randomizing choices among different actions.
What is the significance of Dominant and Dominated Strategies?
A Dominant Strategy is one that is the best choice regardless of what others do, while a Dominated Strategy is worse than another strategy regardless of opponents’ actions.
What is the process of Iterated Elimination?
Iterated elimination involves removing strictly dominated strategies until no further eliminations are possible.
How do you solve Sequential Games?
To solve Sequential Games, draw a game tree and use backward induction to find the rollback equilibrium.
What are Equilibria with non-credible threats?
These are situations where players make threats that they would not actually carry out, requiring a complete contingency plan for later players’ strategies.
What is the approach to solving Simultaneous Games?
Use iterated elimination of strictly dominated strategies and best response analysis to simplify the game matrix.
What is the Prisoner’s Dilemma?
The Prisoner’s Dilemma illustrates a scenario where two players can either cooperate for mutual benefit or defect for individual gain, leading to a suboptimal outcome.
What is a Coordination Game?
In a Coordination Game, both players prefer to take the same action.
What is an Anti-Coordination Game?
In an Anti-Coordination Game, both players prefer to take different actions.
What is the equilibrium in the Volunteer’s Dilemma?
The equilibrium is where one person volunteers while the rest do not.
What is a Mixed-strategy in the Volunteer’s Dilemma?
In a Mixed-strategy, each individual volunteers with some probability p.
What is the implication of the Median Voter Theorem?
If voters have single-peaked preferences, the median voter will have ideal policies, leading to centrist policies being favored over extreme ones.
What does the Tragedy of the Commons address?
It addresses the overpopulation and environmental issues where individual interests conflict with collective welfare.
What solution does Hardin propose for the Tragedy of the Commons?
Hardin suggests a large government with significant power over taxation and reproduction as a solution.
How does Ostrom propose to solve the free-riding problem?
Ostrom suggests allowing binding contracts to address the free-riding problem.
What is the Ultimatum Game?
The Ultimatum Game is a scenario where one player proposes a division of a resource and the other player can accept or reject it.
What is the role of campaign donations according to Fournaies?
Campaign donations are targeted by firms to influence committee leaders and legislative agendas.
What is the Median Voter Theorem?
It states that in an election with an odd number of voters with single-peaked preferences, the median voter’s ideal point is the Condorcet winner.
What are single-peaked preferences?
Each voter has an ‘ideal point’ (most preferred policy), and outcomes further from this point are less preferred.
What is a Condorcet winner?
A policy/candidate preferred to any other in a two-way race by majority vote.
