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Lecture 14 - Backward Induction: Commitment, Spies, and First-Mover Advantages

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Content provided by William Sheppard. All podcast content including episodes, graphics, and podcast descriptions are uploaded and provided directly by William Sheppard or their podcast platform partner. If you believe someone is using your copyrighted work without your permission, you can follow the process outlined here https://ppacc.player.fm/legal.
We first apply our big idea–backward induction–to analyze quantity competition between firms when play is sequential, the Stackelberg model. We do this twice: first using intuition and then using calculus. We learn that this game has a first-mover advantage, and that it comes commitment and from information in the game rather than the timing per se. We notice that in some games having more information can hurt you if other players know you will have that information and hence alter their behavior. Finally, we show that, contrary to myth, many games do not have first-mover advantages.
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24 episodes

Artwork
iconShare
 
Manage episode 207727103 series 2327627
Content provided by William Sheppard. All podcast content including episodes, graphics, and podcast descriptions are uploaded and provided directly by William Sheppard or their podcast platform partner. If you believe someone is using your copyrighted work without your permission, you can follow the process outlined here https://ppacc.player.fm/legal.
We first apply our big idea–backward induction–to analyze quantity competition between firms when play is sequential, the Stackelberg model. We do this twice: first using intuition and then using calculus. We learn that this game has a first-mover advantage, and that it comes commitment and from information in the game rather than the timing per se. We notice that in some games having more information can hurt you if other players know you will have that information and hence alter their behavior. Finally, we show that, contrary to myth, many games do not have first-mover advantages.
  continue reading

24 episodes

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