Course ObjectiveTo get acquinted with behavioral game theory: what is it, what does it
want to accomplish, and can it deliver with respect to the aims it has
set. This includes explaining why observed behavior in experiments
systematically deviates from predictions made by classical Game Theory.
Through performing classroom experiments students will get a more
intense experience of what it means to participate in a game setting, to
better interpret and understand experimental design and develop a
critical attitude towards empirical evidence from experiments.
Course ContentEverywhere people, firms and institutions interact with each other in
many different settings. For instance, negotiations for a contract or
treaty, individuals or firms contributing to a joint partnership,
managers motivating employees. Firms competing on the market, including
web-shops, procurement auctions in B2B for contractors, and art-lovers
competing at Christies. In all cases, the final outcome for each
participant also depends upon the behaviour of others. Each participant
has to deal with the strategic uncertainty about how the others will
behave. Game theory deals with such strategic uncertainty.
For these reasons, game theory has become an influential toolbox in all
branches of Economics, Finance, Management Science and other Social
Sciences. It sometimes serves a normative role for policy advice
(keeping to the same side of the street reduces accidents), and at other
times a descriptive role (keeping the same side of the street is stable
and explains why tourists from the UK keep right in Amsterdam). There is
also substantial evidence from experiments and reality that prediction
by Game theory (and Economic Theory in general) are often different from
empirical evidence. This course offers an inquiry for understanding the
discrepancy between theory and reality. Also, recent theoretical
developments to resolve this discrepancy need investigation.
The inquiry starts with laying bare the foundations of Game Theory: What
are the driving principles and can these principles be tested in
practice? What empirical evidence has behavioral economics produced, in
for game theoretic experiments. This evidence will be investigated to
establish the discrepancy between theory and reality. Finally,
theoretical attempts to restore the descriptive power of Game Theory are
Teaching MethodsBecause of the small group size (about 15 students), the format
differs from regular bachelor courses. The course consists of a mixture
of classroom experiments, lectures in which participants and lecturer
interact, presentations, discussions, reading scientific literature.
Method of AssessmentPresentation and a final individual assignment that includes conducting
experiments and writing an essay.
Entry RequirementsNone, except some elementary knowledge of economics and statistics.
LiteratureSelected scientific articles that are disclosed through Canvas.
Target AudienceHonours students from SBE, other honours students.
Non-SBE honours students are requested to contact the coordinator to
Custom Course RegistrationSBE rules and dates apply for this SBE HP course. Registration for this SBE HP course is via VUnet.
Recommended background knowledgeNone
|Language of Tuition||English|
|Faculty||School of Business and Economics|
|Course Coordinator||dr. H.E.D. Houba|
|Examiner||dr. H.E.D. Houba|
dr. H.E.D. Houba
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Last-minute registration is available for this course.
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