Game theory: history and application.

Game theory is a mathematical method for studying optimal strategies in games. The term "game" should be understood as the interaction of two or more parties that seek to realize their interests. Each side has its own goal and strategy, which can lead to victory or defeat, depending on how the players behave. Thanks to the theory of games, it becomes possible to find the most effective strategy, taking into account the ideas about other players and their potential.

The theory of games is a special section of the study of operations. In most cases, game theory methods are used in economics, but sometimes in other social sciences, for example, in psychology, political science, sociology, ethics and some others. Since the 1970s, biologists to study animal behavior and the theory of evolution have also used it. In addition, today the theory of games is very important in the field of cybernetics and artificial intelligence. That's why we want to tell you about it.

The History of Game Theory

The most optimal strategies in the field of mathematical modeling scholars offered as far back as the 18th century. In the XIX century, the problems of pricing and production in a market with small competition, which later became classic examples of game theory, were considered by scientists such as Joseph Bertrand and Antoine Cournot. And at the beginning of the 20th century outstanding mathematicians Emil Borel and Ernst Zermelo put forward the idea of a mathematical theory of conflict of interest.

The origins of the mathematical theory of games should be sought in the neoclassical economy. Initially, the foundations and aspects of this theory were expounded in the work of Oskar Morgenstern and John von Neumann's Theory of Games and Economic Behavior in 1944.

The presented mathematical field also found some reflection in the social culture. For example, in 1998 Sylvia Nazar (American journalist and writer) published a book dedicated to John Nash, the Nobel Prize winner in economics and a specialist in game theory. In 2001, based on this work, the film "Mind Games" was shot. A number of American TV shows, such as "NUMB3RS", "Alias" and "Friend or Foe" from time to time in their broadcasts also refer to the theory of games.

But I should separately say about John Nash.

In 1949 he was written a thesis on the theory of games, and 45 years later he was awarded the Nobel Prize in Economics. In the very first concepts of game theory, an analysis of antagonistic type was played, in which there are players who have won at the expense of the losers. But John Nash has developed such analytical methods, according to which all players either lose or win.

The situations developed by Nash were subsequently called "Nash equilibrium". They differ in that all sides of the game use the most optimal strategies, thanks to which a stable balance is created. To keep the balance is very beneficial for the players, because otherwise, any one change can adversely affect their position.

Thanks to the activities of John Nash, game theory has received a powerful push in its development. In addition, the mathematical tools of economic modeling were seriously revised. John Nash was able to prove that the classical point of view on the issue of competition, where everyone plays only for themselves, is not optimal, and the most effective strategies are those in which players do better themselves, initially doing better to others.

Despite the fact that, initially, economic models were in the field of game theory, until the fifties of the last century it was only a formal theory limited to mathematics. However, since the second half of the 20th century, attempts have been made to use it in the economy, in anthropology, in engineering, in cybernetics, and in biology. During the Second World War and at the end of it, the military theory began to be considered by the military, who saw in it a serious apparatus in the development of strategic decisions.

In the period 60-70-ies interest in this theory faded, despite the fact that it gave good mathematical results. But since the 80s, the active application of the theory of games in practice has begun, mainly in management and economics. Over the past few decades, its relevance has grown significantly, and some modern economic directions can not be imagined without it at all.

It will not be superfluous to say also that a significant contribution to the development of the theory of games was made by the work "The Strategy of Conflict" of 2005 by the Nobel Prize winner in economics, Thomas Schelling. In his work, Schelling considered many of the strategies used by participants in conflict interaction. These strategies coincided with conflict management tactics and analytical principles used in conflictology, as well as with tactics used to manage conflicts in organizations.

In psychological science and a number of other disciplines the concept of "game" has a slightly different meaning than in mathematics. The cultural interpretation of the term "game" was presented in the book "Homo Ludens" by Johan Huysing, where the author interprets the use of games in ethics, culture and justice, and also points out that the game itself is far superior to the person by age, because animals are also inclined play.

Also the concept of "game" can be found in the concept of Eric Burne, known from the book "People who play games." Here, however, we are talking about exclusively psychological games, the basis of which is transactional analysis.

The application of game theory

If we talk about the mathematical theory of games, at present it is at the stage of active development. But the mathematical base is inherently very expensive, for which reason it is used mainly only if the ends justify the means, namely: in politics, the economy of monopolies and the distribution of market power, etc. In the rest, the theory of games is used in studies of the behavior of people and animals in a huge number of situations.

As already mentioned, the game theory first developed within the boundaries of economic science, which made it possible to define and interpret behavior in various situations of economic agents. But later the scope of its application has significantly expanded and began to include a lot of social sciences, thanks to which, through the theory of games, today explains human behavior in psychology, sociology and political science.

Specialists use the theory of games not only to explain and predict human behavior - many attempts have been made to use this theory in order to develop a reference behavior. In addition, philosophers and economists for a long time with the help of her tried to understand better or worthy behavior as best as possible.

Thus, we can conclude that the theory of games has become a turning point in the development of many sciences, and today it is an integral part of the process of studying various aspects of human behavior.

Conclusion

As you have noticed, the theory of games is rather closely interconnected with conflictology - a science devoted to the study of people's behavior in the process of conflict interaction. And, in our opinion, this area is one of the most important not only among those in which the theory of games should be applied, but also among those that the person himself should study, because conflicts, whatever one may say, are part of our life.

If you have a desire to understand how best to behave in conflicts, and what strategies of behavior exist in general, we suggest that you pass our self-knowledge course, which will fully provide you with such information. But, besides this, after passing our course, you will be able to conduct a comprehensive assessment of your personality in general. And this means that you will know how to behave in the event of a conflict, and what are your personal advantages and disadvantages, life values and priorities, predispositions to work and creativity, and much more. In general, this is a very useful and necessary tool for anyone who aspires to development.
I wish you success and ability to be the winner in any game!