Out that affects you that depends on your own actions and actions of others

Simple grade scheme for the class

If you alpha and your pair beta, (You will get A and your pair will get C)

If you and pair both alpha (You will get B-)

If you put beta and your pair puts alpha (You will get C and your pair will get A)

If you both put Beta (you will both get B+)

a B

A -B C

-B A

b A +B

C +B

a B

A 0 -1

0 3

b 3 1

-1 1

My strategy Alphastricklydominante beta, if my payoff from alpha is strictly greater then that of beta,
regardless of what others do

Lesson 1 :Donot play strictly dominated strategy

Lesson: Rational Choice can lead to outcomes that are not inefficient.

a B

A 0 -3

0 -1

b -1 1

-3 1

Coordination Problem – No dominant Strategy

a B

A 0 -3

0 -3

b -1 1

-1 1

Alpha dominate Beta

Alpha Beta

Alpha 0 -1

0 -1

Beta 3 1

-3 1

My alpha doesnot dominate beta but my pairs choice of alpha dominates her choice of beta. Once she
choice alpha I will choice alpha
Lesson: Put your self into other shoes and try to figure out what they will do

L C R

T 5,-1 11, 3 0,0

B 6,4 0,2 2,0

Strictly Dominates

Easy Hard

Easy 1 1

1 1

Hard 2 0

0 2

Weakly Dominates

Players I strategy ( Si prime) is weakly dominant by her strategy (Si ) if ui(si, s-i) >= (si prime, s-i)

ui(si, s-i) >= (si prime, s-i) for atleast one thing what everybody else would do