# 1 G601, IO I Eric Rasmusen, 31 August 2006 2– Info This is for one 75 minute session on the chapter. The big idea is bayesian equilibrium.

## Presentation on theme: "1 G601, IO I Eric Rasmusen, 31 August 2006 2– Info This is for one 75 minute session on the chapter. The big idea is bayesian equilibrium."— Presentation transcript:

1 G601, IO I Eric Rasmusen, erasmuse@indiana.edu 31 August 2006 2– Info This is for one 75 minute session on the chapter. The big idea is bayesian equilibrium.

2 Readings 31 August, Thursday Information Chapter 2, Games and Information.2, Due 5PM Saturday Sept 2: The HTML project. 5 September, Tuesday. Due: Problem Set 1: 1.1, 1.11, 2.3, 2.5.

3 Handouts Cardstock and pen for name plate REMINDERS Pictures today Do PS 1 for Tuesday If you want a problem partner, email me. Do HTML page for Saturday 5pm NEW: If you DO have a problem set partner, please email and tell me.

4 sdfsd sdf

5 Definitions

6 sdfsd sdf

7 What if Jones does not know which of these three games he is playing? --he does have guesses of probabilities subjective probabilities--- of 70%, 10% 20% sdf

8 This is the Harsanyi Transformation. A game of incomplete information sdf

9 sdfsd sdf

10 sdf

11 sdfsd sdf That is Bayes Rule. I will derive it on the board.

12

13 sdfsd sdf From the previous page:

14 sdfsd sdf From the previous page:

15 sdf Use the three step procedure. 1.Propose an equilibrium. 2.What beliefs are generated? 3. Would anyone deviate?

16 sdfsd sdf From the previous page:

17 Bayes Rule

18 sdfsd sdf (From the previous page)

19 Joness Strategy if Smith Chooses Small

20 sdf

21 Bayes Rule

22

23 Course Website A link to the course website http://www.rasmusen.org/g601/0.g601.htm

24 The Battle of the Sexes

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