Quantitative Economics II
- Introduction, von Neumann-Morgenstern Utility, Nash's axioms.
- Nash's theorem, applications.
- Risk aversion, applications (bribery, asset ownership).
- Discussion of Nash's axioms.
- Applications (moral hazard in teams).
- The strategic approach: Rubinstein's model.
- Strategies in bargaining in the alternating offers model. Nash equilibrium.
- Subgame perfect equilibrium.
- Constant discount rates, fixed bargaining cost, finitely divisible pies.
- Outside options
- More than two players, comparison Rubinstein/Nash
- Incomplete information.
- Markets and decentralised trade.