Basics of Game Theory

This chapter provides a brief overview of basic concepts in game theory. These include game formulations and classifications, games in extensive vs. in normal form, games with continuous action (strategy) sets vs. finite strategy sets, mixed vs. pure strategies, and games with uncoupled (orthogonal) vs. coupled action sets. The next section reviews basic solution concepts, among them Nash equilibria being of most relevance. The chapter is concluded with some remarks on the rationality assumption and learning in classical games. The following chapters will introduce these concepts formally.

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