Rationalisation

Activity (20 minutes)

Goal. Let students feel the best response logic before we formalise it.

Use best responses and have students play against a mixed strategy. Before revealing how the opponent plays, ask each pair to guess the opponent's mix and to commit to a response. Then play against the actual mixed strategy:

>>> import random
>>> random.seed(0)  # Don't seed in class
>>> ["r_2", "r_1"][random.random() < 0.8]  # 80 percent chance of r_2
'r_2'

Compare the responses students committed to with the best response to the revealed mix.

Discussion (20 minutes)

Discuss the Rationalisation chapter.

Discussion Point: After the definition of dominance, ask why dominance is not relevant to the game we played.

Discussion Point: How does the best response condition apply to the matching pennies game we played in class?

From the activity to the exam answer

This activity feeds into the Nash equilibrium material. Use Question 1 (the in-class activity) on the Nash Equilibrium page to show students how the ideas here become a full-mark exam answer.

Communications

General email templates to send before and after this class. Fill in the bracketed placeholders before sending.

Before class

Hi all,

A reminder that our next Game Theory class covers Rationalisation.

All of the course materials, including the relevant chapter, are available
at https://vknight.org/gt/. It is worth skimming the chapter beforehand.

See you in class,
Vince

After class

Dear all,

Thanks for your work in today's class on Rationalisation.

A recording is available here [RECORDING LINK] and on Learning Central.

All class resources are available at https://vknight.org/gt/.

Thanks,
Vince