Game Theory

[[19-01-01-Cognition cognition]], [[13-01-01-Motivation motivation]]

John Von Neumann -create game theory. Theory of game and economic behaviour

W co grają ludzie - Berne Eric Influence book

  • what u do
  • when u do

Game Types

Mathematical modeling at strategic interaction between rational agents.

  • action of one player influence other players (concept of strategic interdependence)
  • assumption that agents act rationally. (rational bah not always conform to reality)

Players, strategy, payoff.

process:

  1. Make assumptions - thought process came from Assumptions. Can dispute, criticize ect… (Carefully with assumptions)
  2. Do math - can not dispute
  3. Reach conclusion

Game theory to work need rational actors

Human Behavioral Biology
Personality
Game Mechanics

  • In lot of species there is no cognitive strategy
  • In real live multiple goals and multiple games

Number of Players

  • Two
  • More players

Progression

  • Turn based
  • Simultaneous move

Number of Rounds

  • Infinite
  • Repeated

Repeated play increase cooperation

Information availability

  • Perfect - known information
  • Incomplite -> Bayesian Nash equilibrium, perfect Bayesian equilibrium
  • Depth limited search.

Zero Sum Game

  • Interest is not overlapping. win-lose

Approaches to Conflict

Cooperative

How to be fair - Group best effort, coalition and benefit and contribution type in coalition

Shapley Value

  • method of dividing gains or costs among players according to value of individual contribution

Marginal Contribution

  • Determined by what is gain or lost by removing them from the game
  • Dummy player have 0 value

If 2 parties bring same things to coalition, they should have to contribute the same amount & should be rewarded for their contributions equal.

Pareto efficiency

Outcome is Pareto optimal if there is no outcome that makes at least one player better off without making any player worse off.

Competitive

How to be smart - Actor best interest - sub optimal solution in the long run

Nash equilibrium

optimal outcome of a game is where no player have incentives to deviate from initial strategy.
(decide to be better off no matter what opponent will do) (rational play when more then one player. not only define start but always believes) Every player play best response strategy to what other doing. Knowing other strategies and have no incentives to cheat. Everyone want to keep it without policing

Most games have odd number of equilibria

no player have profitable deviations


Terms

Risk Aversion

how much u willing to pay for insurance

Tragedy of the Commons

Some public good lot of persons contribute no one want to pay cause take a small parts of contribution only.( there is mat trough to compensate )

there are certain optimal strategies and no other GT solution

Commitment problems

You must commit but not sure what B will chose

Ultimatum Game Assumptions - single ultimatum, Take or leave it

Probability distributuin

  • advancced strategies games, more revarding

Strategies

qualities that will help to win when need to cooperate:

  • Nice
  • Forgiving
  • Retaliatory (if oponent defect strike back immidietly) (can retaliate 9 of 10 times to reduce error)
  • Clear « with complicated program you cannot figure out their strategy. Tit for tat tend to be best. « without signal error in simulation. (when all players rational). most of life is not zero sum.
  • exploitive strategies in poker

stoping problem

37% optimal . after 27% of checked options commit to first that is better then

wazne ile rund. im mniej rund tym mniej kooperacji potrzebujesz!!!!!!

Dominant strategy

  • best payoff no matter other players moves. ITS EXTENTION IS NASH EQQUILIBRIUM (and more)

MinMax

  • minmimize maximum lose. ensure you guarded by worst scenario. (use in zero sum)

Mix Strategy

  • play only if there are indifferences in few strategies

Backward Induction

Base on assumption that all future play will be rational. Whenever I’m making move now I should focus on what opponent will do after that. maximizing

Forward Induction

Based on assumption that all past play was rational

Tic Tac Toe

Pavlov strategy

  • switch if not working (you can exploit)

TfT

  • Tit for tat drove other strategies to extinction and formalize optimal strategy may lose battles but win wars. (Vulnerable of signal error). Start nice cooperating > forgiving > cooperate when you can

FTfT

  • forgiving tit for tat witch is more vulnerable for exploitation TfT -> jezeli zaufanie to switch to forgiven TFTF Trust

Madness

  • possibility of changes
    Strategies to survive forgiving tic for tat (vulnerable to exploit) > forgiven tic for tat after while
  • counterintuitive moves could help with strength opponents.

Game Theory Optimal

  • assumes opponent is always countering with the perfect strategy
  • can have lower yield EV then exploitative play

pkr > fint highest EV lines routes possible for have best formulatetd strategy. + balance it to dont be exploited. but can be not profitable as exploit.
balance stratedy

Exploitative

-humans make a lot errors exploit mistakes exploitative strategy is valuable in the short run after new entry,

Explorative

while explorative strategy is significant in the long run only after new entry.

Jeopardy! Strategy

transitivity-in-game-theory

Games

Poisoner Dilemma

If one round

  • always defect to GTO ( Dominant strategy ) - Best outcome regardless what other player does.
  A (COOP) A (CONFES)
B (COOP) 0 / 0 0 / -2
B (CONFES) -2 / 0 -1 / -1

Stag Hunt

if no lies / neither player deviate

  • Stag/Stag (pareto efficient)
  • Rabit/Rabit (pareto inefficient) are equilibria’s.
  Stag Rabbit
Stag 3, 3 0 , 2
Rabbit 2, 0 1, 1

Coin filps / Matching Pennies

Zero sum game. No pure strategy Nash equilibrium. - If no pure nash exist in mix strategies.

  Heads Tails
Heads 1, -1 -1 , 1
Tails -1, 1 1, -1

Batle of sexes

  Heads Tails
Heads 1, 2 0 , 0
Tails 0, 0 2, 1

A>B>C

  Heads Tails
Heads B, a C, c
Tails C, c A, b

(1,2) - are nash


combinatorial games
diferential games
TCG - traiding card games


Poker

a game of decision-making in the face of incomplete information.

Basics

Betting rounds & Positions

Out Of Position should only defend hands better than In Position

Button / Dealer strongest - 50% opening range / button river betting range (only 57 combos) In position (Act last)
Cutoff second-best position in a hand of poker. Late Positions
HiJack    
LoJack Tide pairs and Figure + high  
Under The Gun +1   Mid positions
Under The Gun only ases (left to the BB Act first Before the flop)
BB defending range calling range 40% (no AA KK QQ - because it wuld be rerange ) play garbage hands priced in (range advantage) Early position
SB tight is right // in short stack when AllIn - is good (game of chicken ) Out of position Act first (After flop)
   
High 1
Pair 2
2 Pairs 2 + 2
Three 3
Straight 1..5
Flush (color)  
Full House 2 + 3
Four 4
Straight  
Royal Flush 1..5

Moves

Bet - change
Check - stay in game, no change
Fold -
Call - answer to bet
Check-raise - The player who checked (in anticipation of others raise) then raises in the same round
Limp - Playing minimum bet when u last to act.

Chips

Chips to start: 20-40 BB for shallow tables to 250+ for deep game

EV

EV = chance * $win - (1-chance) * $lose

Other rules

  • Ante - Ante and Blinds are forced bets
  • Bounty -

pattern visible on table

pair - invisible straight - flush - visible

Strategies

kombninatoryka wazna

  • relation of hands u have to opponent hand
  • your percived range. Whaty they expected u to have

Combinatorics

ranges / minimum defence frequency (MDF) / correct frequencies for calling, folding, and raising (depending on bet size) / likelihood of your opponent holding specific hands 169 different poker hands:
Hand Range Charts

GTO

Game theory optimal - is not enough agressive. Optimize decisions and build strategies to put opponents in place where they have hard time with optimization their decisions (look for weaknes).

Tells

  • How much Engagement in cards
  • protect valuable things, close to you vs prefold (away)
  • eyes,
    • quick glance on chip, thinking about value legs subconcious tels concious tell> playing .. overacting > opposit what trying to convey
  • feet forrward > confidence strengths
  • stop chewing gum if scary , exiced chue
  • disconnect
    • bad cards from the game .
    • good cards just no focs on cards , watch for chit chat

https://www.youtube.com/c/Gametheory101/videos
https://www.youtube.com/c/PrimerLearning/videos

Edge:

kelly cryteria

  • max rate of growth should bet small on each

  • stay in the game long enough to let law of probabilyty work
  • invest more when have more edge
  • under/overbet is bad. - excexs leverage will wipe you out
  • 20% of stack

Bargaining

Bargening dynamics get really complicated really quickly.

   
Proposal power make offers to the other side (accept/reject position not good)
Patience no needing a deal (Tragedy of bargening) ‘rich get richer’
Outside options  
Monopoly Unique quality
Knowledge knowledge of the others sides minimum value dont know choose between lesser of two evils
Reputation  
Credible commitment contracts good / black market bad
Costly signals of higher value  

War

(international relations)

  • war inefficiency puzzle
  • preventive war
  • preemptive war

jak zapobiegać wojnie.

  • kraje handlujące ze sobą mniej wojen (world with trade consume more )
  • koszty

Bio

r/K selection theory trade off between quantity and quality of offspring. r (left), K (right) strategies.


  • coordination problem
  • mysia utopia

SOMETIMES: burning money help to increes payof !!!!!!!!!

Tactics

  • odciecie od zaopatrzenia
  • wysokość - pozycja
  • nacierajacy x3 sil (latwiej bronic)

  • pogoda gdzie sie przemieszczać

# standaard deviation

https://www.google.com/search?q=standard+deviation&source=lmns&bih=786&biw=1597&hl=en&sa=X&ved=2ahUKEwiatuLygbb6AhWJAhAIHfmlCZ4Q_AUoAHoECAEQAA