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Game Theory
In subject area: Neuroscience
Game Theory refers to a language used to model choices
made by purposive agents, where the outcomes of each
player are influenced by the actions of other agents. It
encompasses players, strategies, information, game
structure, and preferences over outcomes. Game Theory
finds applications in various fields such as biology,
international politics, evolutionary adaptation, bargaining,
competition among firms, rule-governed games, and
designing auction rules. It is a valuable tool for analyzing
strategic interactions and predicting players' behavior
based on their beliefs about others' actions.
AI generated definition based on: Neuroeconomics, 2009
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Chapters and Articles
You might find these chapters and articles relevant to this
topic.
Behavioral Game Theory and the
Neural Basis of Strategic Choice
Colin F. Camerer, in Neuroeconomics, 2009
Game Theory
Game theory is a very general language for modeling choices by
purposive agents in which the actions of other agents can affect
each player's outcomes. The elements of a game are players,
strategies, information, a structure or “game form” (e.g., who
chooses when), outcomes which result from all players’ strategy
choices and information, and preferences over those outcomes.
The generality of this language makes it applicable to many levels
of analysis (from biology to international politics). Examples
include evolutionary adaptation of genes competing on the basis
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of fitness, face-to-face bargaining, competition and collusion
among firms, behavior in rule-governed games like chess and
poker which are computationally demanding, inferring something
about a person's preferences or future intentions from their
actions, delicate diplomatic bargaining in which language has
multiple meaning to different audiences, and designing rules to
raise the most revenue from government auctions of scarce
resources.
The aim of this chapter is to introduce some of the essential
components of game theory to neuroscientists (for more details
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URL: https://www.sciencedirect.com/science/article/pii/B9780123741769000130
Social behavior
Colin F Camerer, ... Juin Kuan Chong, in
Current Opinion in Behavioral Sciences, 2015
Introduction
Game theory is a formal approach that has proved useful in
economics and political science, as well as certain areas of
computer science, sociology and biology. However, it has gotten
little traction in cognitive and social psychology because of its
strong assumptions on human behavior. Recent developments
address these limitations, and in this paper, we will describe one
important development in understanding strategic thinking and
aspects of sociality.
Game theory mathematically describes social interactions in
which the actions of one player influence what happens to
another. A description of game or strategic interaction consists of
players, their strategies, the information they have, the order of
their choices, and the utility they attach to each outcome.
Outcomes include tangibles (money earned in an experiment or
poker winnings) and intangibles (emotional satisfaction from
enforcing norms or being ahead of others).
Until the 1990s, most game theorists relied on equilibrium
analysis to predict strategies. Players are considered to be in
equilibrium when they correctly forecast what others will do and
pick a utility-maximizing strategy. For example, always playing
‘rock’ in rock-paper-scissors isn’t an equilibrium strategy. Only
play ‘rock’ if you think your opponent will play ‘scissors,’ but your
opponent won’t do that if they think you’re going to play ‘rock’;
instead, they will play ‘paper’. Therefore, the equilibrium strategy
is to randomly play each hand 1/3 of the time.
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An equilibrium can be a useful prediction of where a social system
may end up because theory and evidence suggest that adaptive
learning and evolutionary selection lead to equilibration [1,2,3•].
However, because of cognitive limitations, it is psychologically
implausible for people to derive equilibrium strategies purely
from thinking. Therefore, equilibrium analysis poorly predicts
outcomes when players encounter new games or there is a shift
such as a policy or technology change.
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URL: https://www.sciencedirect.com/science/article/pii/S2352154615000546
Games in Humans and Non-human
Primates: Scanners to Single Units
Alan Sanfey, Michael Dorris, in Neuroeconomics, 2009
Game Theory
In a similar fashion to the framework provided by utility theory
for studying individual decisions, game theory offers well-
specified models for the investigation of social exchange. The
most important development in this field was the work of von
Neumann and Morgenstern (1947), whose seminal publication
established the foundations of the discipline. In essence, game
theory is a collection of rigorous models attempting to
understand and explain situations in which decision makers must
interact with one another, with these models applicable to such
diverse scenarios as bidding in auctions, salary negotiations, and
jury decisions, to name but a few.
More generally, a common criticism of economic models is that
observed decision behavior typically deviates, often quite
substantially, from the predictions of the standard model. This is
true for the predictions of utility theory for individual decisions
(Kahneman et al., 1982), as well as game theory for social
decisions. Classical game theory predicts that a group of rational,
self-interested players will make decisions to reach outcomes,
known as Nash Equilibria (Nash, 1950), from which no player can
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Behavioral Game Theory and the
Neural Basis of Strategic Choice
Colin F. Camerer, in Neuroeconomics, 2009
Publisher Summary
Game theory is useful for creating a precise mathematical model
linking strategy combinations to payoffs, a kind of periodic table
of the elements of social life. Predictions are made using various
behavioral assumptions about how deeply people reason and how
they react to observed behavior. Game theory could also be useful
in understanding disorders. Some psychiatric disorders could be
understood as disorders in normal social evaluation and
prediction. For example, anti-social personality disorder seems to
disrupt normal valuation of the consequences of one's actions on
others. Using a battery of games, involving altruism, fair sharing,
and trust, has found that patients with ventromedial prefrontal
cortical damage act as if they exhibit less parametric guilt—giving
less and acting in a less trustworthy fashion—than do normal
controls and control patients with damage in other regions. Game
theory is also a tool for understanding expertise and increasing
skill. In a game, there is usually a clear performance metric that
makes the most money. Understanding extraordinary skills in
bargaining, poker, and diplomacy may illuminate the everyday
neural bases of these skills and permit effective training.
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URL: https://www.sciencedirect.com/science/article/pii/B9780123741769000130
Brain Circuitry for Social Decision
Making in Non-Human Primates
Daeyeol Lee, Michael C. Dorris, in
Neuroeconomics (Second Edition), 2014
Game Theory
In essence, game theory is a collection of rigorous models aimed
at explaining situations in which decision makers must interact
with one another, and it is the focus of Chapter 2 in this volume.
In classical game theory (e.g., von Neumann and Morgenstern,
1944), it is assumed that decision makers have full knowledge not
only about each of the alternative actions they can choose, but
also know about how the payoff is determined jointly by their
actions and actions of other decision makers. The concept of an
equilibrium plays a central role in understanding these
interactions. For example, a set of strategies is referred to as a Nash
equilibrium (Nash, 1950; also see Chapter 2) when no individual
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players can increase their payoffs by deviating from such
strategies unilaterally. For example, if both players in a game of
rock-paper-scissors were choosing between the three options
unpredictably and in equal proportions (a mixed-strategy) they
would be at the Nash equilibrium because neither would have an
incentive to change their strategy, conditional upon their belief
that their opponent is also behaving rationally in this regard. Such
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URL: https://www.sciencedirect.com/science/article/pii/B9780124160088000267
Life History, Evolution of
Derek Roff, in Encyclopedia of Biodiversity (Second Edition),
2001
Game Theory
Game theory is really a subset of optimality modeling: it is
appropriate when interactions are frequency dependent. The
approach comprises two essential elements. First, it is assumed
that particular patterns of behavior will persist in a population
provided no mutant adopting an alternate behavior can invade.
Such stable combinations are termed evolutionarily stable
strategies (ESS). The concept of the ESS is not unique to game
theory: the maximization of fitness measures in optimality
models are all ESSs within the context in which they are
appropriate. Second, for each type there must be an assigned gain
or loss in fitness when this type interacts with another individual.
From this payoff matrix we compute the expected payoff for each
behavior. For two behaviors to be evolutionarily stable, their
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URL: https://www.sciencedirect.com/science/article/pii/B9780123847195000873
Negotiations: Statistical Aspects
J. Sebenius, in
International Encyclopedia of the Social & Behavioral
Sciences
, 2001
See also:
Game Theory; Game Theory and its Relation to Bayesian Theory;
Game Theory: Noncooperative Games; Negotiation and
Bargaining: Organizational Aspects; Negotiation and Bargaining:
Role of Lawyers; Organizations: Negotiated Orders; Trade Unions,
Economic Behavior of
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Read full chapter
URL: https://www.sciencedirect.com/science/article/pii/B0080430767004782
Social behavior
Colin F Camerer, ... Juin Kuan Chong, in
Current Opinion in Behavioral Sciences, 2015
Highlights
• Unlike psychology, game theory assumes people have
unlimited cognitive abilities.
• Game theory assumes people forecast accurately what others
do, contrary to evidence.
• CH models interaction of people with different cognitive
abilities in games.
• CH fits over 100 lab and field data sets, as well as eyetracking
and fMRI data
Read full article
URL: https://www.sciencedirect.com/science/article/pii/S2352154615000546
Philosophy of Game Theory
Till Grüne-Yanoff, Aki Lehtinen, in Philosophy of Economics,
2012
4 Game Theory as a Predictive Theory
Game theory can be a good theory of human behaviour for two
distinct reasons. First, it may be the case that game theory is a
good theory of rationality, that agents are rational and that
therefore game theory predicts their behaviour well. If game
theory was correct for this reason, it could reap the additional
benefit of great stability. Many social theories are inherently
unstable, because agents adjust their behaviour in the light of its
predictions. If game theory were a good predictive theory because
it was a good theory of rationality, this would be because each
player expected every other player to follow the theory's
prescriptions and had no incentive to deviate from the
recommended course of action. Thus, game theory would already
take into account that players' knowledge of the theory has a
causal effect on the actions it predicts [Bicchieri, 1993, chapter
4.4]. Such a self-fulfilling theory would be more stable than a
theory that predicts irrational behaviour.8 Players who know that
their opponents will behave irrationally (because a theory tells
them) can improve their results by deviating from what the
theory predicts, while players who know that their opponents
will behave rationally cannot. However, one should not pay too
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Game Theory
K. Yasukawa, in Encyclopedia of Animal Behavior, 2010
Game Theory and Animal Behavior
Many researchers consider the application of game theory to
animal behavior to be one of the two most important theoretical
developments since the modern synthesis of evolution and
genetics. In many respects, game theory has changed the thinking
of those who study animal behavior. The fundamental principle of
game theory that the behavior of one animal affects the fitness of
others and that these effects must be understood when explaining
the evolution of behavior, and the concept of an ESS, have become
a fundamental principle of animal behavior in particular and of
biology more generally. The concept of ESS has also invaded
psychology, political science, and even mathematics itself.
Despite the ability of game theory models to address many
aspects of the social behavior of animals, there have been
relatively few empirical tests of game theory models, especially in
comparison with other classes of models such as optimal foraging.
In addition to the usual objections to theoretical approaches to
biology, game theory models seem to face some particular
difficulties, including that they are unnecessary or that they are
irrelevent because they ignore the underlying genetic structure
and constraints.
On the other hand, game theory models have yielded a rigorous
evolutionary understanding of social behavior that is otherwise
difficult to explain, such as settling contests conventionally,
communicating honestly, cooperation in the face of the
temptation to cheat, and the maintenance of behavioral
polymorphisms. It is likely that empirical testing will become
more common as game theory models make more realistic
assumptions and more explicit predictions, which will make these
models more accessible to empiricists
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URL: https://www.sciencedirect.com/science/article/pii/B9780080453378003557
Related terms:
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Theory of Mind, Neuroeconomics,
Decision Theory, Ultimatum Game,
Behavior (Neuroscience), Parental Care,
Social Interaction, Vigilance, Courtship,
Neuroscience.
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