It sounds like a Sport’s man dream. A Person got a one million dollar prize for their skill at analysing games. They are not television Pundits or armchair critics of Manchester United or Chelsea, but an Economists who won the Nobel Prize for economics for his studies of game theory.
John Nash, In Pop culture he remembered as the man behind “A Beautiful Mind” and for the economists or specialists he’ll be remembered as a brilliant mathematician who won Nobel Prize in Economic Sciences and Abel Prize for his work on partial differentiation.
Nash Equilibrium is a game theory concept, so the general idea about this was it applies to games. Economists had other ideas …show more content…
Another aspect of Nash Equilibrium that hurts brains is that there can be multiple Nash Equilibrium in one game. I am going to describe a two player game for …show more content…
The moves we made initially was not a Nash Equilibrium. If I were allowed to deviate, I would change my pick to 8 and we would both get paid $8 and vice versa. It only takes one of us wanting to deviate to make the scenario a non-Nash Equilibrium. The moves we made in second situation was the perfect example of Nash Equilibrium. If either of us were given the chance to deviate (given that the other player cannot change their move) then neither of us would want to because we'd go from getting $5 to paying something which does not make us better off.
Let’s Discuss Prisoner’s dilemma: A Famous game theory Example
Prisoner’s dilemma is the best known game of strategy. It helps us to understand what regulates the balance between team work and competition. In traditional version of game, the cops have arrested two suspects P1 & P2 and interrogating them in separate rooms. The police don’t have enough evidence to convict them. If they could get a confession from either of them then they can convict them both. They have four options now: If P1 confessed and P2 stayed silent then P1 would go free and P2 would be charged robbery for 10 years and of course this worked in other way