5 – Nash Equilibrium: Bad Fashion and Bank Runs

5 – Nash Equilibrium: Bad Fashion and Bank Runs

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We first define formally the new concept from last time: Nash equilibrium. Then we discuss why we might be interested in Nash equilibrium and how we might find Nash equilibrium in various games. As an example, we play a class investment game to illustrate that there can be many equilibria in social settings, and that societies can fail to coordinate at all or may coordinate on a bad equilibrium. We argue that coordination problems are common in the real world. Finally, we discuss why in such coordination problems–unlike in prisoners’ dilemmas–simply communicating may be a remedy.

4 – The Rise of the Polis

4 – The Rise of the Polis

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In this lecture, Professor Donald Kagan offers a sketch of the Greek heroic code of ethics. He shows that in this community, arête (manly virtue) and honor are extremely important and even worth dying for, as the case of Achilles makes clear. In addition, Professor Kagan shows how this society eventually produced a new phenomenon, the rise of the polis. The discussion ends with a strong emphasis on the importance of the polis in Greek history.

4 – Best Responses in Soccer and Business Partnerships

4 – Best Responses in Soccer and Business Partnerships

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We continue the idea (from last time) of playing a best response to what we believe others will do. More particularly, we develop the idea that you should not play a strategy that is not a best response for any belief about others’ choices. We use this idea to analyze taking a penalty kick in soccer. Then we use it to analyze a profit-sharing partnership. Toward the end, we introduce a new notion: Nash Equilibrium.

3 – The Dark Ages (cont.)

3 – The Dark Ages (cont.)

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In this lecture, Professor Kagan addresses what scholars call the Homeric question. He asks: what society do Homer’s poems describe? He argues that in view of the long oral transmission of the poems, the poems of Homer probably reflect various ages from the Mycenaean world to the Dark Ages. More importantly, close scrutiny of the poems will yield historical information for the historian. In this way, one is able to reconstruct through the poems, to a certain extent, the post-Mycenaean world. Finally, Professor Kagan says a few words on the heroic ethic of the Greek world.

3 – Iterative Deletion and the Median-Voter Theorem

3 – Iterative Deletion and the Median-Voter Theorem

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We apply the main idea from last time, iterative deletion of dominated strategies, to analyze an election where candidates can choose their policy positions. We then consider how good is this classic model as a description of the real political process, and how we might build on it to improve it. Toward the end of the class, we introduce a new idea to get us beyond iterative deletion. We think about our beliefs about what the other player is going to do, and then ask what is the best strategy for us to choose given those beliefs?

2 – The Dark Ages

2 – The Dark Ages

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In this lecture, Professor Donald Kagan explores the earliest history of Greek civilization. He demonstrates how small agricultural enclaves eventually turned into great cities of power and wealth in the Bronze Age, taking as his examples first Minoan Crete and then Mycenaean Greece. He also argues that these civilizations were closely related to the great monarchies of the ancient Near East. He points out that the Mycenaean age eventually came to an abrupt end probably through a process of warfare and migration. Reconstructing the Mycenaean age is possible through archaeological evidence and through epic poetry (Homer). Finally, he provides an account of the collapse of the Mycenaean world, and explains how in its aftermath, the Greeks were poised to start their civilization over on a new slate.

2 – Putting Yourselves into Other People’s Shoes

2 – Putting Yourselves into Other People’s Shoes

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At the start of the lecture, we introduce the “formal ingredients” of a game: the players, their strategies and their payoffs. Then we return to the main lessons from last time: not playing a dominated strategy; and putting ourselves into others’ shoes. We apply these first to defending the Roman Empire against Hannibal; and then to picking a number in the game from last time. We learn that, when you put yourself in someone else’s shoes, you should consider not only their goals, but also how sophisticated are they (are they rational?), and how much do they know about you (do they know that you are rational?). We introduce a new idea: the iterative deletion of dominated strategies. Finally, we discuss the difference between something being known and it being commonly known.

1 – Introduction

1 – Introduction

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Professor Donald Kagan explains why people should study the ancient Greeks. He argues that the Greeks are worthy of our study not only because of their vast achievements and contributions to Western civilization (such as in the fields of science, law, and politics) but also because they offer a unique perspective on humanity. To the Greeks, man was both simultaneously capable of the greatest achievements and the worst crimes; he was both great and important, but also mortal and fallible. He was a tragic figure, powerful but limited. Therefore, by studying the Greeks, one gains insight into a tension that has gripped and shaped the West and the rest of the world through its influence. In short, to study the Greeks is to study the nature of human experience.

1 – Introduction: Five First Lessons

1 – Introduction: Five First Lessons

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We introduce Game Theory by playing a game. We organize the game into players, their strategies, and their goals or payoffs; and we learn that we should decide what our goals are before we make choices. With some plausible payoffs, our game is a prisoners’ dilemma. We learn that we should never choose a dominated strategy; but that rational play by rational players can lead to bad outcomes. We discuss some prisoners’ dilemmas in the real world and some possible real-world remedies. With other plausible payoffs, our game is a coordination problem and has very different outcomes: so different payoffs matter. We often need to think, not only about our own payoffs, but also others’ payoffs. We should put ourselves in others’ shoes and try to predict what they will do. This is the essence of strategic thinking.

A Conversation with Chris Gondek, Michael Makovsky, Tennent Bagley and Emily Cockayne

A Conversation with Chris Gondek, Michael Makovsky, Tennent Bagley and Emily Cockayne

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Chris Gondek speaks with Michael Makovsky about Winston Churchill’s views on Zionism, Tennent Bagley about a KGB defector in the 1960s, and Emily Cockayne about urban nuisances people suffered in the 17th and 18th centuries.