IB3H9-15 Strategic Games: Thinking rationally about business, policy and real life
Introductory description
This is an elective module available for WBS and non-WBS students*. To find detailed availability and to apply for this module, log in to my.wbs.ac.uk using your normal IT login details and apply via the my.wbs module application system. Once you’ve secured a place on my.wbs you should apply via your home department’s usual process, which usually takes place via eVision. Note that you do not require the module leader’s permission to study a WBS module, so please do not contact them to request it.
Most choices involve interaction, and cannot be made successfully without taking that into account. Our choices affect others, and their choices affect us. Such interactive situations have come to be called "games", and "game theory" is a way of analysing the strategies that can be used in these games, and the strategies that should be used. The "theory" part of game theory starts by assuming everyone is rational, and then works out what actions a rational person (or animal, or machine – personhood is not required, but preferences are) will do in any given interactive situation. Rationality means, roughly, that everyone is trying to maximise the expected benefit from the choices they make. This does not exclude the possibility that they get benefits from how well or how poorly others do: we are entitled to be competitive, spiteful, or altruistic.
This module provides a relatively non-technical and highly selective introduction to game theory and its applications. The focus will be on strategic situations that are either likely to be encountered in everyday life, that shed light on everyday interactions, or are simply fundamentally interesting.
*Please note that Economics students are unable to take this module due to overlapping content in Year 1 and 2 Economics modules.
Module aims
The principal module aims are:
- To develop students' theoretical and practical understanding of strategic decisions using tools drawn from economics, game theory, and psychology.
- To enable students to interpret social and psychological situations within this framework.
- To encourage students to take a broad view of policy decisions that have strategic implications, and to predict the consequences of those policies.
Outline syllabus
This is an indicative module outline only to give an indication of the sort of topics that may be covered. Actual sessions held may differ.
The syllabus will include such topics as:
- Definition of strategic situation and equilibrium.
- Backward induction and rollback equilibrium.
- Strategic moves and the problem of credibility.
- Nash equilibrium in pure and mixed strategies.
- The prisoner's dilemma and the tragedy of the commons.
- Asymmetric information and unravelling.
- Screening and Signalling.
- Matching games and the deferred acceptance algorithm.
- Bargaining and negotiation.
- Evolutionary games.
- Auction theory and the winner's curse.
- Intrapersonal game.
Learning outcomes
By the end of the module, students should be able to:
- Deploy the basic concepts of strategic thinking, in a largely non-mathematical way. These concepts include strategy, Nash equilibrium, prisoner's dilemma, backward induction, winner's curse, informational unravelling, and asymmetric information, costly signalling, and matching.
- Demonstrate logical and critical thinking skills in being able to recognize the potentially counter-intuitive effects of strategic decisions.
- Recognise the links between situations that differ widely in content but share common underlying strategic structures.
- Distinguish between the outcome of logical analysis and 'psychological' analysis of strategic situations.
- Discuss critically the strategic thinking underlying a broad range of decisions taken from all aspects of life.
- Analyse strategic situations and act so as to achieve optimal outcomes, including negotiations with others, and even with your own future selves.
Indicative reading list
Some useful resources:
-Dixit, A. K., Skeath, S., & McAdams, D. (2020). Games of Strategy. Norton. (Fiifth edition, but any edition is good)
-Schelling, T. (1976). Micromotives and Macrobehaviour. Norton.
-McMillan, J. (1992). Games, Strategies and Managers. Oxford University Press. (Good illustrations of how game theory can be used in management settings.)
-Roth, A. E. (2015). Who Gets What—and Why: The New Economics of Matchmaking and Market Design. Houghton Mifflin Harcourt.
Subject specific skills
Distinguish between the mathematical and economic concept of the correct strategy, and the 'psychological' concept, meaning what might be the correct strategy given what others are likely to do.
Analyze how strategic thinking can influence success in all aspects of life.
Transferable skills
Perspective taking.
Logical analysis.
Presentation skills and argumentation.
Study time
| Type | Required |
|---|---|
| Lectures | 10 sessions of 1 hour (7%) |
| Seminars | 9 sessions of 1 hour (6%) |
| Online learning (scheduled sessions) | 2 sessions of 1 hour (1%) |
| Online learning (independent) | 10 sessions of 1 hour (7%) |
| Private study | 47 hours (31%) |
| Assessment | 72 hours (48%) |
| Total | 150 hours |
Private study description
Private Study.
Costs
No further costs have been identified for this module.
You do not need to pass all assessment components to pass the module.
Assessment group D8
| Weighting | Study time | Eligible for self-certification | |
|---|---|---|---|
| Participation | 10% | 7 hours | No |
| Examination | 90% | 65 hours | No |
|
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Assessment group R3
| Weighting | Study time | Eligible for self-certification | |
|---|---|---|---|
| In-person Examination | 100% | No | |
|
Examination
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Feedback on assessment
Feedback will be provided via my.wbs.
Pre-requisites
Economics students are unable to take this module due to content overlap in Year 1 and 2 Economics modules.
Courses
This module is Optional for:
-
UIBA-N20B BSc in Management
- Year 3 of N20B Management
- Year 3 of N20B Management
- Year 3 of N23K Management with Accounting
- Year 3 of N234 Management with Digital Business
- Year 3 of N235 Management with Entrepreneurship
- Year 3 of N232 Management with Finance
- Year 3 of N252 Management with Marketing
- Year 3 of N23L Management with Strategy and Organisation
- Year 3 of UIBA-N400 Undergraduate Accounting and Finance
-
UIBA-N404 Undergraduate Accounting and Finance (with Foundation Year and Placement/Undergraduate Partnership Programme)
- Year 5 of N4N7 Accounting and Finance (Foundation Year and Intercalated)
- Year 5 of N404 Accounting and Finance (Foundation Year and Placement)
- Year 5 of N405 Accounting and Finance (Foundation Year and UPP)
- Year 5 of N403 Accounting and Finance (with Foundation Year)
- Year 4 of UIBA-N403 Undergraduate Accounting and Finance (with Foundation Year)
-
UIBA-N401 Undergraduate Accounting and Finance (with Placement Year/Undergraduate Partnership Programme)
- Year 4 of N401 Accounting and Finance (Placement)
- Year 4 of N402 Accounting and Finance (Undergraduate Partnership Programme)
- Year 3 of UCSA-I1N1 Undergraduate Computer Science with Business Studies
- Year 4 of UCSA-I1NA Undergraduate Computer Science with Business Studies (with Intercalated Year)
- Year 1 of UIOA-EEU Undergraduate EU Exchange
- Year 4 of UGEA-RN21 Undergraduate German and Business Studies
- Year 4 of UIPA-L8N1 Undergraduate Global Sustainable Development and Business
- Year 3 of UIPA-L8N2 Undergraduate Global Sustainable Development and Business Studies (with Intercalated Year)
-
UIBA-N20F Undergraduate International Management
- Year 4 of N20F International Management
- Year 4 of N20F International Management
- Year 4 of N20S International Management (with Accounting)
- Year 4 of N20T International Management (with Chinese)
- Year 4 of N20P International Management (with Entrepreneurship)
- Year 4 of N20M International Management (with Finance)
- Year 4 of N20U International Management (with French)
- Year 4 of N20L International Management (with Marketing)
- Year 4 of N20V International Management (with Spanish)
- Year 4 of N20W International Management (with Strategy and Organisation)
- Year 4 of N20N International Management with Digital Business
- Year 4 of N20E Management (with Foundation Year)
- Year 4 of N234 Management with Digital Business
-
UIBA-N20J Undergraduate Management (with Foundation Year and Placement Year/Undergraduate Partnership Programme)
- Year 5 of N20J Management (Foundation Year and Placement)
- Year 5 of N20K Management (Foundation Year and UPP)
- Year 5 of N23H Management with Digital Business (with Foundation Year and Placement Year)
- Year 5 of N23J Management with Entrepreneurship (with Foundation Year and Placement Year)
- Year 5 of N23G Management with Finance (with Foundation Year and Placement Year)
- Year 5 of N255 Management with Marketing (with Foundation Year and Placement Year)
-
UIBA-N20E Undergraduate Management (with Foundation Year)
- Year 4 of N20E Management (with Foundation Year)
- Year 4 of N23N Management with Accounting (with Foundation Year and Placement Year)
- Year 4 of N23M Management with Accounting (with Foundation Year)
- Year 4 of N23E Management with Digital Business (with Foundation Year)
- Year 4 of N23F Management with Entrepreneurship (with Foundation Year)
- Year 4 of N23D Management with Finance (with Foundation Year)
- Year 4 of N252 Management with Marketing
- Year 4 of N254 Management with Marketing (with Foundation Year)
- Year 4 of N23P Management with Strategy and Organisation (with Foundation Year)
-
UIBA-N20C Undergraduate Management (with Placement Year/Undergraduate Partnership Programme)
- Year 4 of N20M International Management (with Finance)
- Year 4 of N20B Management
- Year 4 of N20D Management (Undergraduate Partnership Programme)
- Year 4 of N20C Management (with Placement Year)
- Year 4 of N20Q Management with Accounting (with Placement Year)
- Year 4 of N236 Management with Digital Business (with Placement Year)
- Year 4 of N237 Management with Entrepreneurship (with Placement Year)
- Year 4 of N232 Management with Finance
- Year 4 of N233 Management with Finance (with Placement Year)
- Year 4 of N253 Management with Marketing (with Placement Year)
- Year 4 of N23L Management with Strategy and Organisation
- Year 4 of N20R Management with Strategy and Organisation (with Placement Year)
-
UMAA-G1NC Undergraduate Mathematics and Business Studies
- Year 3 of G1NC Mathematics and Business Studies
- Year 3 of G1NC Mathematics and Business Studies
- Year 4 of UMAA-G1N2 Undergraduate Mathematics and Business Studies (with Intercalated Year)
-
UIOA-EOS Undergraduate Overseas Exchange
- Year 1 of UEOS Undergraduate Overseas Exchange
- Year 1 of UEOS Undergraduate Overseas Exchange
- Year 4 of UPXA-F3ND Undergraduate Physics and Business Studies (with Intercalated Year)
- Year 3 of UPXA-F3N2 Undergraduate Physics with Business Studies
- Year 1 of UIOA-EUS Undergraduate USA Exchange