Brexit and Chicken game

• Economie
• HBO
• Studiejaar 3

Good morning!

Group assignment

- You'll get a group assignment
- The assignment itself will follow

- You will all be given the choice individually:
will you or will you not cooperate? 

From now on, no communication!

Read in silence..

You will all be given the choice individually: will you or will you not cooperate well on the group assignment? 

If you choose NO, then you don’t have to do anything. If you choose YES, you must be present during the last two hours each day next week to work on the assignment in the classroom. The grade your group gets for this assignment is calculated as follows:

Number of students that DO cooperate × 10 / number of group members

Will you or will you not cooperate well on the group assignment?

YES

NO

How did you make your decision?

At the end of the lesson..

1. You can explain what 'game theory' is

2. You can give a real life example of game theory

3. You can analyse a pay-off matrix

4. You can create your own pay-off matrix

Game Theory

Game theory

- Choices

- Pay off depends on your choice and choice of the other

- Based on rational action

Emotions are excluded!

Game of chicken

1. Two players

2. Both drive into each other

3. Who swerves first is the chicken

4. Who doesn’t swerve is the hero

What do you think that a 'pay-off matrix' is?

Nash equillibrium

For both players it doesn’t pay off to differ from the equillibirum

Equillibrium: there are two lines in one square

It’s the common option that’s best for both players, given the dicision of the other player

Explain whether Brexit is a chicken game or not?

00:56

'Theresa May on a bicycle, cycling furiously towards the EU'
What do you think this statement means?

01:17

Why is the border between the UK and Northern Ireland an issue?

1. It will cost a lot of money to build
2. Due to the Good Friday agreement
3. UK trades a lot with Ireland
4. The Irish citizens have close bonds with the English

02:15

What Brexit options
did you hear?

Let's check the lesson objectives!

1. Can you explain what 'game theory' is?

2. Can you give a real life example of game theory?

3. Can you analyse a pay-off matrix?

4. Can you create your own pay-off matrix?