The course extends the analysis of game theory and business strategy that you began in the Managerial Economics portion of the Core. The course's ultimate aim is to strengthen your ability to think strategically in business situations, rather than to teach you facts or theories. To achieve this aim, we will iterate between theory and practice.
G570 has the luxury of only having to cover both useful and fun topics. Enjoy, and learn!
G570 Readings Packet, TIS. Click here for its contents.
The "strategic journal" is a set of six one-page write-ups you will do weekly on various applications of game theory. Each Tuesday except the first day of class you will hand in a write-up of at most one page (2 pages if handwritten) applying some idea of that week or earlier in the course to your daily life, the news, literature, or anything else that strikes you. You may use tables and figures, and they can be handwritten even if the rest is typed-- neatness is not important for this assignment. I will grade these simply as Check, Check-minus, or Check-plus, with most assignments receiving Check. The purpose of keeping the journal is to have you practice strategic thinking in real world situations. Every week I would like you first to give a brief summary of what you are commenting on, and then record your own thoughts. After you make your comments, read them over. Note any counterarguments that come to mind, and rebut them if you can. It is also acceptable to show why your original thought is just plain wrong; a manager needs to learn how to refute his own bad ideas.
Thinking strategically moves beyond formal game theory. While there are some situations in your future careers where you will want to actually write down game trees and solve for equilibria, often you will be using game-theoretic ideas less formally. Both the strategic planner and the second-to-second bond trader are using game theory, whether they know it or not. Keeping the journal will guide you towards this way of thinking.
Date and title each entry. Do not pick examples of price theory or decision theory; look for situations where one person or company is thinking about another specific person or company's response. Do not review academic articles. Most entries my students have written concern their daily lives at home and the Kelley School, business items in the news, and international and domestic politics. The best entries are usually the ones involving daily life. I've posted examples on the web.
Attendance is necessary to get the full benefit out of this class. I hope that we have considerable give-and-take during the lectures. This requires that you be responsible enough to do the reading before class.
My office is on the 4th floor, north end of the building. Feel free to stop by any time. If my door is even a little bit open, that means you can knock and have a good chance of finding me able to talk. If it is closed, I am probably not there or am on the phone or otherwise busy. You can also drop by during office hours or make an appointment, or use email to contact me. I am often in my office on Saturdays, but the outer doors are closed after 5 and on weekends, so call me at 855-3356 or email me.
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