Extended Outline

  1. Monopoly

    1. Monopoly Problem

      • elasticity of demand, markup, price-cost margin, Lerner Index.

    2. Price Discrimination

      • first-/second-/third-degree price discrimination, nonlinear pricing, arbitrage, hidden information, commitment.

    3. Imperfect Market Competition

      • function, domain, range, one-to-one, onto.

  2. Introduction to Game Theory

    1. Illustration: Slide

  1. Static Games and Nash Equilibrium

    1. Normal-form Game

      • normal-form, players, strategies, payoff, strategy space, strategy profile, payoff function.

    2. Nash Equilibrium

      • best response, Nash equilibrium.

    3. Why and How Is Nash Equilibrium Reached?

      • rationality, focal point, self-enforcing agreement, repeated play, path dependence.

  1. Static Oligopoly Models I

    1. Hotelling Model of Spatial Competition

    2. Bertrand Model of Duopoly

      • Bertrand paradox.

    3. Cournot Model of Duopoly

  1. Static Oligopoly Models II

    1. Further Analysis on Cournot Model

    2. Bertrand Model with Product Differentiation

    3. Bertrand or Cournot?

  1. Mixed Strategies and the Existence Theorem

    1. Illustration: Slide

    2. Mixed Strategies

    3. Existence of Equilibrium

      • Kakutani's fixed point theorem, best response function.

  1. Dynamic Games and Extensive-Form Representation

    1. Illustration: Slide

    2. Extensive-Form Game

      • extensive-form, strategy, information set, perfect information game, imperfect information game.

  1. Subgame Perfect Nash Equilibrium

    1. Subgame Perfect Nash Equilibrium

      • subgame perfect, subgame perfect Nash equilibrium (SPNE).

    2. Stackelberg Model of Duopoly

  1. Applications of Dynamic Games

    1. Strategic Investment

      • strategic substitutes, strategic complements, fat-cat, lean and hungry, top dog, puppy-dog.

    2. Bargaining Model

  1. Repeated Games

    1. Finitely Repeated Games

      • stage game, finitely repeated game.

    2. Infinitely repeated Games

      • average payoff, infinitely repeated game, history, trigger strategy.

    3. Falk Theorem

      • feasible.

  1. Static Games with Incomplete Information

    1. Bayesian Games

      • nature, type.

    2. Cournot Game with Unknown Cost

    3. Bayesian Nash Equilibrium

      • strategy, belief, Bayes' rule, Bayesian Nash equilibrium.

    4. Revelation Principle

      • direct mechanism.

  1. Dynamic Games with Incomplete Information

    1. Perfect Bayesian Equilibrium

      • belief, sequentially rational, Bayes' rule, on the equilibrium path, off the equilibrium path, perfect Bayesian equilibrium (PBE).

  1. Applications of Incomplete Information Games

    1. Market for Lemon

    2. Signaling Games

    3. Cheap Talk Games

  1. Bargaining Problems

    1. Cooperative Games

      • cooperative game, coalitional game.

    2. Nash Bargaining Solution

      • bargaining problem, agreement, disagreement outcome, bargaining solution, Nash (bargaining) solution.

    3. Axiomatic Approach

      • independence of irrelevant alternatives (IIA).

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