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Matthew O. Jackson, Kevin Leyton-Brown, and Yoav Shoham

Popularized by movies such as "A Beautiful Mind", game theory is the mathematical modeling of strategic interaction among rational (and irrational) agents. Over four weeks of lectures, this advanced course considers how to design interactions between agents in order to achieve good social outcomes. Three main topics are covered: social choice theory (i.e., collective decision making and voting systems), mechanism design, and auctions.

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Popularized by movies such as "A Beautiful Mind", game theory is the mathematical modeling of strategic interaction among rational (and irrational) agents. Over four weeks of lectures, this advanced course considers how to design interactions between agents in order to achieve good social outcomes. Three main topics are covered: social choice theory (i.e., collective decision making and voting systems), mechanism design, and auctions.

In the first week we consider the problem of aggregating different agents' preferences, discussing voting rules and the challenges faced in collective decision making. We present some of the most important theoretical results in the area: notably, Arrow's Theorem, which proves that there is no "perfect" voting system, and also the Gibbard-Satterthwaite and Muller-Satterthwaite Theorems. We move on to consider the problem of making collective decisions when agents are self interested and can strategically misreport their preferences. We explain "mechanism design" -- a broad framework for designing interactions between self-interested agents -- and give some key theoretical results. Our third week focuses on the problem of designing mechanisms to maximize aggregate happiness across agents, and presents the powerful family of Vickrey-Clarke-Groves mechanisms. The course wraps up with a fourth week that considers the problem of allocating scarce resources among self-interested agents, and that provides an introduction to auction theory.

You can find a full syllabus and description of the course here: http://web.stanford.edu/~jacksonm/GTOC-II-Syllabus.html

There is also a predecessor course to this one, for those who want to learn or remind themselves of the basic concepts of game theory: https://www.coursera.org/learn/game-theory-1

An intro video can be found here: http://web.stanford.edu/~jacksonm/Game-Theory-2-Intro.mp4

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What's inside

Syllabus

Social Choice
The description goes here
Mechanism Design
Efficient Mechanisms
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Auctions
Final Exam

Good to know

Know what's good
, what to watch for
, and possible dealbreakers
Incorporates 3 main topics of game theory, making its content comprehensive
Builds on top of basic game theory concepts, making it suitable for advanced learners
Examines concepts that are useful in diverse fields like economics, computer science, and business strategy
Instructed by highly respected professors, offering valuable insights from leaders in the field
Utilizes a multi-modal approach with videos, readings, and discussions, enhancing learning experience
Offers a deeper understanding of the mathematical modeling of strategic interaction, beneficial for researchers

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Reviews summary

Challenging and rewarding game theory ii course

According to students, Game Theory II: Advanced Applications is a challenging but rewarding course that delves into advanced game theory concepts. Learners describe the course as interesting and in-depth, with a focus on mathematical content. While the course is demanding, it effectively prepares students for more advanced game theory studies. However, some learners may appreciate additional practice opportunities through optional assignments.
Expect a lot of math.
"The content is very full-on mathsy rather than being a dumbed down version."
This course prepares you for advanced studies.
"After finishing this course I attend the master course in my university without difficulty to follow."
Consider providing more practice opportunities.
"The only thing for improvement is the homework. If lecturers could post some optional homeworks for students who want to train more, then this course will be really a University-level course for undergraduate students."
Prepare for a rigorous course.
"The course is great but quite challenging."

Activities

Be better prepared before your course. Deepen your understanding during and after it. Supplement your coursework and achieve mastery of the topics covered in Game Theory II: Advanced Applications with these activities:
Review Game Theory
Lay a foundation for the course by reviewing basic game theory concepts
Browse courses on Game Theory
Show steps
  • Brush up on Nash Equilibrium and Dominant Strategies
  • Review the Prisoner's Dilemma
  • Read through examples of game theory in practice
Solve Game Theory Practice Problems
Sharpen your problem-solving skills and reinforce core concepts
Browse courses on Game Theory
Show steps
  • Find a collection of game theory practice problems
  • Allocate dedicated time for solving these problems
  • Review your solutions and identify areas for improvement
Work through Game Theory Examples
Solidify understanding of game theory through guided practice
Browse courses on Game Theory
Show steps
  • Find online tutorials on game theory applications
  • Practice solving game theory problems step-by-step
  • Review solutions and compare your approach
Six other activities
Expand to see all activities and additional details
Show all nine activities
Read The Art of Strategy: A Game Theorist's Guide to Success in Business and Life
Gain insights into game theory from a practical, real-world perspective
Show steps
  • Read through each chapter and take notes
  • Identify key concepts and their applications
  • Consider how the book's examples relate to course material
Attend a Game Theory Study Group
Engage with peers to discuss concepts, solve problems, and enhance learning
Browse courses on Game Theory
Show steps
  • Find a study group or organize one with classmates
  • Prepare discussion topics or problems to bring
  • Actively participate in group discussions and problem-solving
Attend a Workshop on Game Theory Applications
Expand knowledge and gain hands-on experience through a dedicated workshop
Browse courses on Game Theory
Show steps
  • Research and identify relevant workshops
  • Register for a workshop that aligns with your interests
  • Actively participate in the workshop and engage with experts
Develop a Game Theory Model for a Real-World Situation
Apply game theory principles to a practical problem, fostering deeper understanding
Browse courses on Game Theory
Show steps
  • Identify a real-world situation that involves strategic interaction
  • Develop a game theory model to represent the situation
  • Analyze the model to predict outcomes and identify optimal strategies
  • Present the model and your findings
Mentor a Beginner in Game Theory
Reinforce your understanding by sharing knowledge and guiding a beginner
Browse courses on Game Theory
Show steps
  • Volunteer or find someone who is new to game theory
  • Create a plan to cover basic concepts and answer questions
  • Meet regularly to discuss game theory and provide guidance
Contribute to Open-Source Game Theory Projects
Engage in real-world game theory applications while enhancing your technical skills
Browse courses on Game Theory
Show steps
  • Find open-source game theory projects on platforms like GitHub
  • Identify areas where you can contribute your knowledge and skills
  • Submit pull requests or collaborate on existing projects

Career center

Learners who complete Game Theory II: Advanced Applications will develop knowledge and skills that may be useful to these careers:
Game Theory Analyst
Game theory analysts are trained to approach problems in a manner very similar to that taught in this course. They build models that represent how individuals interact, with the intent of making predictions and recommendations about how outcomes can be improved.
Market Researcher
Market researchers use game theory to model consumer behavior, predicting how consumers respond to competing products. They often run simulations using principles taught in courses like this to estimate market share and understand market dynamics.
Behavioral Scientist
Behavioral scientists are trained to build models of human behavior. Game theory is an essential tool for this profession, informing models of how human beings make social and economic decisions.
Operations Research Analyst
Operations research analysts use principles from game theory to analyze complex business problems and design solutions. This course is a foundation for further study in OR and provides tools that OR analysts use daily in their work.
Risk Management Analyst
Risk management analysts use game theory to model scenarios and estimate the potential financial impact of different events. This course may also be helpful for understanding quantitative methods used in the field.
Consultant
Consultants in a variety of fields may find this course to be helpful. The course will help build a foundation in game theory for those who wish to work in strategy consulting, operations consulting, or even consulting on matters of public policy.
Economist
This course can provide economists a foundation for thinking about social choice theory, mechanism design, and auctions. This may be helpful for economists working in fields such as public finance, industrial organization, or political economy.
Lawyer
This course may be helpful for lawyers who work in fields such as antitrust law, intellectual property law, or bankruptcy law. The course can help lawyers understand the strategic behavior of clients and other parties involved in legal disputes.
Political Scientist
This course may be helpful for political scientists who work in fields such as public choice theory, or for those working in international relations or comparative politics who wish to understand how strategic incentives shape political interactions.
Software Engineer
This course may be helpful for software engineers who are interested in building systems that require modeling strategic interactions. This could be relevant for engineers working on social networks, marketplaces, or auction platforms.
Data Scientist
This course can help data scientists understand how to model and analyze strategic interactions in data. This is particularly relevant for data scientists working in fields such as social media analysis, fraud detection, and recommender systems.
Financial Analyst
This course may be helpful for financial analysts who wish to understand how game theory can be applied to investment decision-making, portfolio management, and risk assessment.
Product Manager
This course can help product managers understand how to design products that take into account the strategic interactions of users. This can be particularly relevant for product managers working on social media platforms, e-commerce websites, or gaming platforms.
Marketing Manager
This course may be helpful for marketing managers wishing to understand how consumers make decisions. This can be particularly relevant for marketing managers who are developing marketing campaigns or pricing strategies.
Sales Manager
This course may be helpful for sales managers looking to understand the psychology of sales negotiations. The course can also help sales managers develop strategies for negotiating with customers and clients.

Reading list

We've selected 21 books that we think will supplement your learning. Use these to develop background knowledge, enrich your coursework, and gain a deeper understanding of the topics covered in Game Theory II: Advanced Applications.
Classic work on social choice theory. It provides a comprehensive overview of the field, including discussions of Arrow's Theorem, the Gibbard-Satterthwaite Theorem, and the Muller-Satterthwaite Theorem.
Classic work on auction theory. It provides a comprehensive overview of the field, including discussions of different types of auctions, bidding strategies, and market efficiency.
Classic work on game theory and conflict resolution. It provides a number of insights into how people make decisions in conflict situations.
Provides a comprehensive overview of bargaining and negotiation in international relations. It covers a wide range of topics, including different types of negotiation, negotiation strategies, and the role of power in negotiation.
Provides an introduction to the intersection of evolution and game theory. It covers a wide range of topics, including the evolution of cooperation, the evolution of altruism, and the evolution of language.
Provides a non-technical introduction to game theory. It covers a wide range of topics, including the prisoner's dilemma, the tragedy of the commons, and the ultimatum game. This book may be useful for learners who want a more accessible introduction to game theory before taking this course.
这本书是中国学者张维迎写的博弈论专著,从社会科学的角度出发,对博弈论的原理、应用和局限性进行了深入浅出的阐述。
这本书是中国学者许成钢写的拍卖理论专著,从理论和实践的角度出发,对拍卖理论与实践进行了全面的阐述。
This textbook provides a thorough introduction to game theory, with a focus on applications to economic modeling. It covers topics such as Nash equilibrium, strategic form games, and extensive form games.
This classic work provides a rigorous mathematical treatment of social choice theory, including a proof of Arrow's Theorem.
Provides a broad overview of the history of strategy, from ancient times to the present day.
Provides a comprehensive overview of cognitive psychology, with a focus on decision-making.
Discusses the role of habits in our lives and how to change them.
This classic work provides advice on how to acquire and maintain political power.

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