Game theory: What it reveals about what is wrong with mainstream economics

Game theory has helped, more than anything perhaps, to define what is today's mainstream economics. This is because it is a theory of interactive decision making: that is, a theory of how people make decisions when they know that the consequences of their decisions depend on what other people a...

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Bibliographic Details
Published in:Journal of Australian political economy 2017-06 (80), p.74-87
Main Author: Heap, Shaun P. Hargreaves
Format: Article
Language:English
Subjects:
Action
Analysis
Cooperation
Decision making
Determinate
Dominance
Econometric models
Economic aspects
Economics
Equilibrium
Equilibrium (Economics)
Expected utility
Game theory
Mainstreaming in education
Nash equilibrium
Philosophy
Rational choice
Rationality
Scrutiny
Social sciences
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Summary:Game theory has helped, more than anything perhaps, to define what is today's mainstream economics. This is because it is a theory of interactive decision making: that is, a theory of how people make decisions when they know that the consequences of their decisions depend on what other people also decide to do. In a complex economy where people rarely interact in textbook competitive markets, this fills what would otherwise be a rather large gap in economic theory. Further, since there are few social or political decisions that do not also fit this definition of interactive decision making, it has significantly contributed to the increasing dominance of mainstream economics as a way of thinking throughout the social sciences.
ISSN:0156-5826
1839-3675