...A game is any situation of conflict with at least two players (it may be a person, company). Each side chooses some kind of behavior (strategy) to get the best payoff. Game theory is a way to study conflicts and strategies used to get best results. The decision process is made without full knowledge and that’s what drives people engage into game to strategize to get as good output as possible- perfectly to win everything or at least to lose as little as possible. Game theory as a mix of psychology, mathematics, logic and other academics areas can be useful in several ‘real life’ situations, including negotiations and business. It can be observed in an oligopoly market, when two companies offering a very similar product (for example gas) must find a way to win over their competitors. One can notice parallels in a situation of those companies and classical example of the game theory “prisoner dilemma”. Game theory may also be used in auctions, mergers and acquisitions, bargaining, real estate negotiations, salary negotiations and so on. The most common application of game theory in real life is setting price. Each company wants to set price as high as possible to maximize profit but also wants to win market share as big as possible. Companies can all set the same price for their products and split the profit between themselves or one could try and forecast an advantageous set of lower prices and basically win since their higher market share even at their lower prices will...
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...Mandy Sanguigni Dr. Park Monopoly Simulation Reflections October 5, 2016 On October 5, 2016, during our Sociology 101 class we were played the game Monopoly. Each group member was given a different social class: middle class, upper middle class, or upper class and each needed to follow the given rules for each individual class. My particular selection was the upper middle class. Each member was given a starting asset amount, which my starting amount was only $1710.00, which was not much. It was frustrating and difficult to move ahead and succeed in the game when restricted with assets, property and overall not unable to buy particular areas around the board. I had a difficult time paying and buying appropriate buildings. The ending assets did have a slight gain of $438 to show an ending asset balance total of $2138.00. One who was upper class was taking advantage of their rules and punishing the under classes to pay extra and receive less money. The rules that were given were different for each social class. The social class I was in made me only buy land from only the three sides of the board (from GO to GO TO JAIL), buy houses and hotels as I wish, anytime the lower class received a bill through community chest or chance I would be responsible for paying the bill, and once landed on jail I would have to try rolling doubles or pay $25 just to get out. These rules were hard to follow with the amount of money given in the beginning and not collecting enough once pass GO. Some...
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...Prisoner's Dilemma (Stanford Encyclopedia of Philosophy) 4/3/12 9:58 AM Open access to the SEP is made possible by a world-wide funding initiative. Please Read How You Can Help Keep the Encyclopedia Free Prisoner's Dilemma First published Thu Sep 4, 1997; substantive revision Mon Oct 22, 2007 Tanya and Cinque have been arrested for robbing the Hibernia Savings Bank and placed in separate isolation cells. Both care much more about their personal freedom than about the welfare of their accomplice. A clever prosecutor makes the following offer to each. “You may choose to confess or remain silent. If you confess and your accomplice remains silent I will drop all charges against you and use your testimony to ensure that your accomplice does serious time. Likewise, if your accomplice confesses while you remain silent, they will go free while you do the time. If you both confess I get two convictions, but I'll see to it that you both get early parole. If you both remain silent, I'll have to settle for token sentences on firearms possession charges. If you wish to confess, you must leave a note with the jailer before my return tomorrow morning.” The “dilemma” faced by the prisoners here is that, whatever the other does, each is better off confessing than remaining silent. But the outcome obtained when both confess is worse for each than the outcome they would have obtained had both remained silent. A common view is that the puzzle illustrates a conflict between individual and...
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...export oriented economy with greater export than import, they will have very little incentive to remove barriers. But, it is believed by realists that if multiple countries come together the incentive to remove barriers is higher. There is always a conflict going on for national states. They want to promote free trade as everyone agrees that free trade will benefit them but they do worry about their national sovereignty. As Gilpin (Gilpin, 2001)says “ Whereas powerful market forces (trade, finance and investments) jump political boundaries and integrate societies, Governments frequently restrict and channel their economic activities to serve the interests of their own societies and powerful groups within those societies”. Then there is the Prisoner’s Dilemma from Game theory that explains the dilemma...
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...Prisoner’s dilemma is as standard example of game theory that shows that two rational indicidual might not cooperate even if cooperation will fit their best interest. (wiki) Let me explain the prisoner’s dilemma first. In prisoner’s dilemma, each individual act rationally. That means each individual should do anything that benefit her/him. Let’s imagine Jack and Rose has committed a crime and are arrested. During the interrogating, they are separated in two interrogate room, the game is shown below. - - Rose stays silent ( cooperates) - Rose betrays (defects) - Jack stays silent (cooperates) - Each serves 1 year - Jack: 3 years - Rose: goes free - Jack betrays (defects) - Jack: goes free - Rose: 3 years - Each serves 2 years In this dilemma,...
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...Prisoner’s Dilema is a game with non-zero sum in game theory. The simplest form of the game have two gamer (called prisoner), each prisoner always wants to get the benefit for himself, no matter what the other benefit is. The result of the game is not optimal. If two prisoners cooperate with each other, the result is the best. But each prisoner naturally has a motivation to escape the prison. So that I is the reason why they call “dilemma”. Prisoner’ Dilemma focuses on researching the instant decision making when the prisoners have no time or do not expect to the cooperation or association in the future. The question is that two prisoners think rationally; this means that each prisoner chooses the most benefit option for himself no matter what the other want to cooperate or not, so they always choose the uncooperative option and this makes them have nothing. If they choose the cooperative option, both of them have benefit. pp.229 We assume the numerical result of China and Mexico when each nation produces or does not produce steel components in the table below: Japan Mexico Producing Not Producing Producing +10 +10 -10 +20 Not Producing +20 -10 -5 -5 From the table we can see that If Mexico chooses producing steel components option and Japan does not produce steel components, Japan (+20) will get more benefit than Mexico...
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...MOI UNIVERSITY KHADIJAH KWEYU CONFLICT MANAGEMENT & NEGOTIATION BHR 107 Discuss the basic theoretical models of bargaining process and explain how they can improve individuals negotiation skills in an organisation. Introduction: Bargaining can be defined as an agreement between parties settling what each gives or receives in a transaction between them or what course of action or policy each pursues in respect to the other. The study of bargaining process involves an analysis of the actors, the stakes and the factors involved. All theories feed into each other, and combining these theories allows for a more complete understanding of the issues involved in bargaining process and therefore helps to improve individuals negotiation skills. There are several different theories analyzing the process and outcome of bargaining process as follows:- 1. Integrative Approach Model 2. Game Theory 3. Behavioral Theory 4. Power Theory 5. Optimal Agent Independence 1. Integrative Approach Model The integrative approach divides the negotiating process into three phases: • Diagnostic • Formulation • Details In the practice of negotiation, these phases are not necessarily linear. Rather, they can be repeated and addressed many times throughout the negotiation process. The toughness dilemma in the integrative approach calls for tough diagnosis in order to clearly elucidate the true interests of each party. In the formulation...
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...| The Need for Bureaucracy | | | | | | Name: Rob Lee TA: Vanessa Dolishny Student #: 250535352 Date: 2010-03-17 Throughout this course, inequality has been a topic that has been brought up in each sociological category. Some of these categories include religion, race and ethnicity, culture, education, and organizations and work. Karl Marx’s perspective of capitalist domination, which relates to each of these categories, suggests that the main cause of conflict in society is inequality, and this inequality brings about disadvantages to workers and benefits to the owners of capital. Although this perspective is backed by strong examples in today’s society, such as the decline in skilled labour leading to greater inequality between the proletariat (workers) and the bourgeoisie (capital owners), it spends too much time on blaming the structure of the system for making inequalities worse, without taking into consideration how much worse these inequalities would be today if the system were not structured the way it is. Therefore, when criticizing systems such as government, and its ability to organize and manage society, it is essential to recognize that without a government in place, and if society were to be adhocratic, the world would be chaotic and not nearly as efficient as it would be if a government were established. The government plays key roles in not only the stabilization of society, but also in helping it prosper in the long run. In...
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...Your Name 07/07/14 –Economics Unit 3 Prisoner’s Dilemma/ Part 1 1. What is a prisoner’s dilemma game? The Prisoner’s Dilemma is the best-known game of strategy in Social Science. It help us understand what governs the balance between cooperation and competition in business. 2. What is a dominant strategy? If a strictly dominant strategy exists for one player in a game, that player will play that strategy in each of the game's Nash equilibrium. If both players have a strictly dominant strategy, the game has only one unique Nash equilibrium. 3. What is a cartel? A cartel is a collection of businesses or countries that act together as a single producer and agree to influence prices for certain goods and services by controlling production and marketing. 4. What is Nash equilibrium? (In economics and game theory) a stable state of a system involving the interaction of different participants, in which no participant can gain by a unilateral change of strategy if the strategies of the others remain unchanged Part 2 – Standard Example | Clyde confesses | Clyde is silent | Bonnie confesses | Both get 10 years. | Bonnie-6 months/Clyde gets 20 years. | Bonnie is silent | Clyde gets 6 months, Bonnie is charged 20 years. | Both get a year. | 1. What is the equilibrium in this game? The equilibrium in this game would be the participation on an agreement between both of the participants, but due to a case of dishonesty, one participant can...
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...RadioLab's podcast about the prisoner's dilemma gave another example of how this theory can affect if a person will defect or not. An important element that was pointed out during the show was the relationship between the two players. They then pointed out how the relationship affects the players decision. They asked the question, "Do I know this guy?" If not, im throwing him under the bus. When hearing this I thought about the card game that we played in class because if your partner was your friend the chances of you cooperating was higher than if it was a stranger. But one solution that they figured out was by conducting a computer terminant tournament where you submitted games concerning the prisoner's dilemma in which you played with other...
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...Critical Thinking 5 Assignment NAME GRADE 76 Questions Salvatore 10: Discussion Question 2 (a) What are the advantages of the Herfindahl index over concentration ratios in measuring the degree of concentration in an industry? (b) What is the disadvantage of both? ANSWER: (a) The advantages of the Herfindahl index are: (1) uses information on all the firms in an industry, not just market share of the largest 4,8 or 12. (2) appropriately gives more weight to larger firms than to smaller firms within the industry. (b) Disadvantage to both is that they may overestimate the market power of the largest firms in the industry. Neither model considers contestable markets; this is also a disadvantage of both. Salvatore 10: Discussion Question 8 In what way does OPEC resemble a cartel? How successful is it? ANSWER: OPEC resembles a cartel because it represents a group of producers that exist with the desire to set prices beyond the competitive level. They do this by controlling supply of oil produced by its members. Much like a cartel, OPEC's decisions are dictated in the manner to which they will provide the greatest profit for the cartel members. (b) Not very successful, when OPEC increased prices beyond competitve levels, the market responded by decreasing demand for product, which in turn decreased production and export activity for OPEC members. A number or geo-political factors have both historically and recently created spikes in oil prices. Find the Herfindahl index for an...
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