Class # 3: Key Takeaways

The Long shadow of the Endgame?

Class #3 concluded our unit on look forward, reason back. There were three key observations to come out of this unit.

1. The long shadow of the endgame--the end of the game casts a "shadow" over the entire strategic interaction.

NBA Free Agency Key Takeaways

The central point of the experiment was to illustrate the difference between the game theoretic value of an option compared to the valuation of options in finance. In the NBA free agency game, the option provokes a strategic response from the rival team. Specifically, the presence of the option destroys the possibility of bidding successfully for the player and hence nullifies competition. The option is only valuable when it is not exercised. Exercising the option means that it has failed to stave off competition.

Class #2 Key Takeaways

In class #2, we started talking about the fundamental rule of thinking strategically--look forward and reason back. We illustrated this in two ways. First, in durable goods industries, often competition comes from future "selves" of the firm. For instance, a firm selling a technology product can look forward and anticipate that it will want to cut prices in the future.

Road Map: Classes 4 and 5

In class #4, we will be completing the Coors case and then playing the McCain-Schumer game. Please read the instructions carefully before class. In class #5, we will debrief McCain-Schumer and then talk about the case Game Theory and Business Strategy.

Experiment 1 Results

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Please send me the results from the NBA game by Tues at 1159pm. Also, if you have not already done so, please send me the name of your team and its members. Finally, we currently have 15 teams, which is one too many. If you are team consisting of 3 members, please consider joining a larger team. All teams should have 4-5 members

Road Map: Classes 2 and 3

For class 2, we'll do the NBA free agency experiment and debrief. Class 3 will cover the Coors case (a follow on from core Strategy) as well as the analytics of look forward, reason back.

Before class 2, please remember to form your team and come up with a colorful nickname.

Welcome to Game Theory

Photo Credit: John Morgan

Welcome to the Game Theory Blog. Here you will find updates and roadmaps for upcoming classes, results from experiments, videos, as well as key takeaways from each class. Please check back here for the latest. Please become a follower of this blog.

Also, it is ideal if the blog is interactive. Please submit comments if you have a take about what's covered in the blog or have suggestions for topics.

In preparation for Class 1, please check out the course overview lecture notes. You can find them here and here. The first of these links is the "live" syllabus. As new content is added, the links to that content will go live. The second is the handouts tab of the course website, for later reference.

For transparency reasons, the course website is not on bspace. You can find it here The reason is that bspace is walled off from Game Theory alumni. I want those who took the course in the past to be able to access the materials. As a result, I make everything available without walls.

See you in class!