Overview
Nash Equilibrium is a fundamental concept in game theory that describes a situation where players reach a stable outcome, and no one can benefit from changing their strategy unilaterally. It is widely applicable in various fields, including economics, political science, and social interactions, help...
Key Terms
Example: Game theory helps analyze competitive situations in economics.
Example: Choosing to cooperate or compete is a strategic decision.
Example: In a business game, profits can be considered payoffs.
Example: Always pricing lower than competitors can be a dominant strategy.
Example: If competitors lower prices, a best response might be to match their prices.
Example: In a market, equilibrium occurs when supply equals demand.
Related Topics
Prisoner's Dilemma
A classic example in game theory illustrating cooperation and betrayal.
intermediateCooperative Game Theory
Focuses on how players can benefit from cooperation and binding agreements.
advancedEvolutionary Game Theory
Studies strategic interactions in biological contexts and evolution.
advancedKey Concepts
Game TheoryStrategiesPayoffEquilibrium