Overall objectives:

1 - Be able to analyse the strategic behaviour of agents in static and dynamic games with complete information.
2 - Applying game theory to the resolution and modeling various economic problems.
3 - Be able to think critically and evaluate an economic argument;
4 - Ability to apply knowledge in game theory to the solution of theoretical and applied economic problems.

Syllabus:

1 - Introduction to game theory
2 - Static games with complete information
2.1. - Representation of a game in the normal or strategic form
2.2. - Iterated elimination of strictly dominated strategies and strictly dominant strategy equilibrium
2.3 - Nash equilibrium
2.4 - Applications of Nash equilibrium ­ Models of oligopoly (Cournot and Bertrand)
2.5 - Mixed strategy Nash equilibrium
3 - Dynamic games of complete and perfect information
3.1 - Representation of a game in the extensive form
3.2 - Backward Induction
3.4 - Applications: Stackelberg Model
4 - Dynamic games of complete and imperfect information
4.1 - Representation of a game in the extensive form
4.2 - Subgame Perfect Nash Equilibrium
4.3 - Applications
5 - Repeated Games
5.1 - Finite Repeated Games
5.2 - Infinite Repeated Games
5.3 - Tacit collusion in oligopoly
5.4 - Other Applications

Literature/Sources:

Gibbons, R. , A Primer in Game Theory , Prentice Hall
Baye, M. , Managerial Economics and Business Strategy , MacGraw­Hill
Osborne, M. , An Introduction to Game Theory , Oxford University Press

Assesssment methods and criteria:

Classification Type: Quantitativa (0-20)

Evaluation Methodology:
Theoretical classes allow a rigorous exposition of theoretical concepts. They are especially designed to meet learning objectives 1 and 2. Practical lessons, in presenting applications and concrete problems, contribute to fulfill objectives 2 and 4. The evaluation throughout examinations covers all learning objectives, while the assignment essentially evaluates learning objectives 3 and 4. Regular term: Written test (40%); Evaluation sheets (10%), and Assignment (50%) Supplementary and special term: Exam (50%); and Assignment (50%). Minimum passing grade in all evaluation elements: 9.5