Problem 4 Consider a two-stage game where two players, Ann and Beth, must first decide on a game to play (either prisoner's dilemma or stag hunt), and, if they agree, play that game. If they do not agree to play the same game, neither player receives any payoff. The game is summarized below: Beth cooperate 2,2 defect 0,3 Ann cooperate Beth prisoner's dilemma stag hunt defect Beth cooperate 3,0 Ann prisoner's dilemma stag hunt 0,0 defect 1,1 Beth prisoner's dilemma 0,0 Beth stag 3,3 stag hare hare Ann stag hunt 0,2 Beth stag 2,0 hare 1,1 a) Find the minimal proper subgames. b) Find the SPNE.
Problem 4 Consider a two-stage game where two players, Ann and Beth, must first decide on a game to play (either prisoner's dilemma or stag hunt), and, if they agree, play that game. If they do not agree to play the same game, neither player receives any payoff. The game is summarized below: Beth cooperate 2,2 defect 0,3 Ann cooperate Beth prisoner's dilemma stag hunt defect Beth cooperate 3,0 Ann prisoner's dilemma stag hunt 0,0 defect 1,1 Beth prisoner's dilemma 0,0 Beth stag 3,3 stag hare hare Ann stag hunt 0,2 Beth stag 2,0 hare 1,1 a) Find the minimal proper subgames. b) Find the SPNE.
Chapter8: Game Theory
Section: Chapter Questions
Problem 8.9P
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