Game theory: an introduction

This comprehensive textbook introduces readers to the principal ideas and applications of game theory, in a style that combines rigor with accessibility. Steven Tadelis begins with a concise description of rational decision making, and goes on to discuss strategic and extensive form games with complete information, Bayesian games, and extensive form games with imperfect information. He covers a host of topics, including multistage and repeated games, bargaining theory, auctions, rent-seeking games, mechanism design, signaling games, reputation building, and information transmission games. Unlike other books on game theory, this one begins with the idea of rationality and explores its implications for multiperson decision problems through concepts like dominated strategies and rationalizability. Only then does it present the subject of Nash equilibrium and its derivatives. "Game Theory" is the ideal textbook for advanced undergraduate and beginning graduate students. Throughout, concepts and methods are explained using real-world examples backed by precise analytic material. The book features many important applications to economics and political science, as well as numerous exercises that focus on how to formalize informal situations and then analyze them. It introduces the core ideas and applications of game theory. It covers static and dynamic games, with complete and incomplete information. It features a variety of examples, applications, and exercises. Topics include repeated games, bargaining, auctions, signaling, reputation, and information transmission. It is ideal for advanced undergraduate and beginning graduate students. Complete solutions available to teachers and selected solutions available to students.

Part I: Rational decision making. The single-person decision problem -- Introducing uncertainty and time -- Part II: Static games of complete information. Preliminaries -- Rationality and common knowledge -- Pinning down beliefs: Nash equilibrium -- Mixed strategies -- Part III: Dynamic games of complete information. Preliminaries -- Credibility and sequential rationality -- Multistage games -- Repeated games -- Strategic bargaining -- Part IV: Static games of incomplete information. Bayesian games -- Auctions and competitive bidding -- Mechanism design -- Part V: Dynamic games of incomplete information. Sequential rationality with incomplete information -- Signaling games -- Building a reputation -- Information transmission and cheap talk -- Mathematical appendix.