Game Theory 101: Forward Induction and Burning Money

[TinBryn]

can this somewhat be used to explain the seemingly irrational position of preferring option A over B, B over C and C over A, in that in each three cases the elimination of the other option changes the equilibrium

[gianpinna]

Hey, have you already made a video about signal games??? Thanks for posting all this stuff on the internet.

[JimBobJenkins]

@gianpinna No, I've done virtually nothing with incomplete information.

[gianpinna]

@JimBobJenkins

F**k! I have an assignment for tomorrow and i can't really find out how to find the bayesian nash equilibrium in those games. Too complicated!

[JimBobJenkins]

@gianpinna That's not going to be fun at all. What's the setup?

[gianpinna]

@JimBobJenkins

I have to think about a real life example of a signal game and after solve the game. Some i'm virtually free to make the payoffs i prefer. But i got the structure of the signal games. I just can't understand how to solve them...

[gianpinna]

That was really bad english, i'm sorry. I write again:

I have to think about a real life example of a signal game and after solve the game. So i'm virtually free to put the payoffs i prefer. I got the structure of the signal games. I just can't understand how to solve them...

[JimBobJenkins]

@gianpinna Check your inbox.

[centurion180ad]

Burning money is destroying other people's resources and hence damaging their own potential maximums, to force outcomes that would not otherwise be foregone.

It is a strategy of control freak plundering bigots.

[terlisimo]

Did I get this right:

The ability of P1 to burn money changed the (sub)game from having two weakly dominant pure strategy equilibriums and one mixed strategy equilibrium to having just one pure strategy equilibrium which is a perfect nash equilibrium and that is going to the fight, i.e. fight strictly dominates?

So the idea is, the player with more money to burn will always get his/her way even if he/she doesn't ever burn any money simply by having the ability to burn it?

[edinhenrik]

What is the real meaning of burning money, could you exemplify?

[JimBobJenkins]

@edinhenrik I study international relations, so the classic example here is states doing worthless military exercises. They cost a ton but don't really do much for the actual quality of your military.

[TeppTennis]

I just watched all these videos. is tis all the class is about or are u missing some chapters covered in this class?

[GeminiPaladin]

Try to some how apply this while involving Flores and metagames