mixed strategy

Today was second class of Economics of Organization. Today’s lecture was for theoretical Framework. I was worried about that, but it was not so complicated.

First, we saw mechanism of inefficiency. Inefficiency is caused by three constraints: cognitive(=understanding), motivational, and exceptional. In lecture, we focus motivational constrain, but this makes “second-best”. “First-best” is made if only the resource constrain binds. “Third-best” is made by optimal option within restricted solutions.

After that, we learned basic framework of game theory. But I could not understand mixed strategies.

Mixed strategies are different from pure strategy because mixed ones consists of some choice of strategy with possibilities. If we can think game as mixed strategies, there is more than one strategy. And mixed strategy equilibrium can get from intersection of expectations of each player. ( Equilibrium is the point of each player’s outcome is same, but it can be got from equations of each options outcome).