Seminar on equilibria behaviour

Here is a brief summary of the seminar today.

A recording of the class is available here.

You can see the abstract for the seminar here

The seminar started with an auction for £10 with the important caveat that:

1. The highest bidder gets the £10.
2. The second highest bidder pays as well.

Scion and Cain ended up both caught in a bidding war.

If Scion had bid £9.50 and Cain £10.00, Scion has two actions available:

• Stopping bidding which leads to: Scion losing £9.50 and Cain getting £10.00.
• Bid again, bidding £10.50 which leads to: Scion losing £10.50 and Cain losing £10.00

This cycle escalates as each player’s best choice at each step is to bid again.

We eventually stopped the auction finding a way for Scion and Cain to share the £10 I took from my wife’s wallet that morning.

After that I gave the seminar which gave an overview of a number of building blocks of Game Theory leading up to the concept of a Nash equilibria.

I also mentioned the move “Beautiful Mind” which is about John Nash. If there’s any interest maybe we could have a class movie evening to watch it.