Game Theory - Descriptive, Normative or Prescriptive?

In real life, the theory cannot provide a straightforward strategy used by the competitor or to be used against the competitor because it is not clear what strategy the competitor has chosen (Li & Yu,2016).

The decisions or strategies one company chooses will likely motivate other competitors to respond. Using the game theory allows a company to assess and understand more about itself and its competitors so that it can adjust and shape the competition to maximize its win probability (Johnson, 2014). Some examples of how A&D companies apply the game theory in their decision making are:

Nash (1950) postulated the Nash Equilibrium (NE) and has since been implicated in many aspects of human endeavour, and one of which is rational decision making. A facet of NE shows that a rational decision becomes optimal when a considered decision is made within the context of the organisation’s objectives and is independent of others. Because

Some of the concepts/models that are applied to strategic problems vary in meaning depending on the setting one is in whether it be in the actual real world or in the classroom. These

In a real sense, it cannot give a correct strategy that can be taken by the competitor because a competitor is flexible to change their decision any time depending on the goals intended. It also does not explain the reasons behind opting for a certain strategy (Li & Yu, 2016).

Games can be very hard. States can be only observes to a certain extend. Multiple agents choose Actions, stochastic pays off and state transition depends on state and other

Since the beginning of time, we are wired to plan, prepared and act on a particular goal we are set to achieve. There are simplicities and complexities in the matters of strategic planning. The simple concept is we already plan strategically on a daily basis (i.e. getting to work every day); however, the complicated portion comes when others come to play, and resources are scarce. However, we cannot deny that daily we strategize in our personal lives. We reflect concerning what to cook, how to lose weight, or who will pick up the kids on Friday. If a person does not plan they may conclude at work with two different color shoes or with no food, or a babysitter for Friday. Now, let's consider this concept of planning strategies to a superior

9. What’s the flaw of accepting the notion of “ceteris paribus” when analyzing a strategy?

Two researches were conducted by both Weigel and Bonica, The Macroeconomics Game: Trade or Raid and The Healthy Policy Game: Vote,

Strategic thinking involves using ethical and moral reasoning to think about the future of an organization. This type of thinking usually starts about changes that you have noticed in the organizational climate, which are usually called mental models. Mental models are simplified understandings or representations of the phenomena that the organization encounters. These type of models can tell a strategic leader what is and is not important to the organization, what they do and do not like, what they should and should not notice. By knowing this, they include understandings of how things work and what are expected

One of the biggest challenges that we encountered were to determine what course of action to take in case that Pleo gets in the way of another Pleo, or that he has encountered that the other Pleo has caused a blockage on it’s original plan. We therefore had to decide on how we were going to approach this possibility. We then realized that a good way of approaching the issue would be by looking at it from the perspective of game theory. With game theory, we assume that the other team is acting on a rational way, and that the decisions that Pleo was going to make were going to be based on the best possible outcome of this interaction. We compared the possible outcomes against the rubric that was provided to us, and assigned

Game theory cannot always predict reliable outcomes for real-life situations as it is more an

Nash equilibrium is a solution theory of a non-cooperative game which involves two or more

This is an argument between the conceptuality and the practicality of Nash equilibrium in Economics. To understand it we need to first look into what economics is about, which is the study of social and human interaction and rational decision making quantitatively. Nash equilibrium can act as a tool to provide an insight into such interaction. In the first part of this essay, I am going to evaluate why the statement ‘economics without the concept of Nash equilibrium is conceptually flawed’ is true, by looking into the importance of rationality in economics and the mechanism of the Nash equilibrium. In the second part, I am going to assess why the argument for ‘Economics with the concept of Nash equilibrium is practically useless’ is true

From the above mentioned examples, we can validate that Game-Theoretic modeling plays an invaluable role as a metaphorical approach to strategic management (Saloner, 1991). Game Theory provides measurable simulations of what could happen to enable rationalization of the best course of action without incurring the heavy costs of a true trial and error method. With that said, as noted in our introduction, while game theory