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public:courses:others:competitive_strategy:intro [2014/07/30 21:28] (current)
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 +====== Competitive Strategy ======
 +
 +  * Source: https://​www.coursera.org/​learn/​competitivestrategy/​outline?​module=WeFmF
 +  * From **Universit√© Louis-et-Maximilien de Munich (LMU)**, by **Tobias Kretschmer**
 +
 +===== Take care of your competitors =====
 +
 +==== Simultaneous Games ====
 +
 +  * A strategy is a player'​s plan of actions in a "​game"​.
 +  * Important parts of a game are: **players, actions, payoffs, and rules**.
 +
 +  * You can usually rely on the other players having a **dominant strategy**.
 +  * **Dominated strategy**: a strategy that never does better that a given other strategy (eg. the dominant one).
 +  ​
 +  * When we have a game matrix then the idea is to eliminate the dominated strategies.
 +
 +  * **Nash equilibrium** = a combination of strategies such as no player can deviate unilaterally from his current strategy to improve his payoffs.
 +  * We can have a **Nash Equilibrium** without every player having a dominant strategy.
 +  * Prisoner'​s Dilemma : when nash equilibrium is not the best option the players could get if they were working together.
 +  ​
 + ==== Sequential Games ====
 +
 +  * Sequential games == Dynamic games (eg. games with a time aspect).
 +  * We draw **game trees** in that case.
 +    * First decision start the game
 +    * Then for each decision, the other player can take its own decision.
 +    ​
 +  * **backward induction** : simplification of sequential game.
 +    * eliminating options that do not maximize profit.