The University of Kent, Canterbury, Kent, CT2 7NZ, T +44 (0)1227 764000
EC806 Advanced Microeconomics of Games and Information
What the module is about
The module consists of two parts. The first part focuses on non-cooperative game theory, and its use in economics. Note that applications of game theory arise not only in Microeconomics but also in Industrial Organisation, Labour Economics, International Economics, Macroeconomics etc. The second part analyses the behaviour of markets in which traders are asymmetrically informed. Uncertainty affects all the fundamental variables that determine individual behaviour, explain choices and bring about decisions. We look closely at choice decisions when either moral hazard or adverse selection is present.
A good understanding of topics in advanced micro theory is essential to understanding the content and direction of modern economics. Game theory and the economics of information and uncertainty have become major areas of microeconomic research in the last couple of decades.
- Static games of complete information
- Dynamic games of complete information
- Static and dynamic games of complete information
- Uncertainty and insurance: An introduction
- Moral hazard and Principal-Agent theory
- Adverse selection
There is no single textbook that covers the full contents of the course. Therefore, several reading sources will be used in this module. A list of some relevant books is given below, though occasionally we will also use journal articles to explain certain topics in more detail.
- Gibbons, R., Primer in Game Theory, Pearson Education
- Kreps, D. M., A Course in Microeconomic Theory, Prentice Hall Europe
- Macho-Stadler, I. and Perez-Castrillo, J.D., An Introduction to the Economics of Information, Oxford University Press
- Osborne, M., An Introduction to Game Theory, Oxford University Press
- Rasmusen, E., Games and Information, Blackwell Publishers
- Tirole, J., The Theory of Industrial Organisation, MIT press
- Varian, H. R., Microeconomic Analysis, Norton
The reading list contains the basic readings for the course. Please note, in most cases the readings are alternatives. The use of additional bibliography is encouraged (especially for seminar discussions). It is recommended that you buy at least one textbook and have access to the other readings through the library.
Please check for the latest edition.
Download the EC806 module outline here.