Static Games

Abstract

An interactive decision problem involves two or more individuals making a decision in a situation where the payoff to each individual depends (at least in principle) on what every individual decides. Borrowing some terminology from recreational games, which form only a subset of examples of interactive decision problems, all such problems are termed “games” and the individuals making the decisions are called “players”. However, recreational games may have restrictive features that are not present in general games: for example, it is not necessarily true that one player “wins” only if the other “loses”. Games that have winners and losers in this sense are called zero-sum games; these are considered in Section 4.7.3.