Applied Mathematics

Other Areas of Applied Mathematics

What is game theory?

As the words imply, game theory has to do with the mathematics and logic used in the analysis of games—or the situations that involve groups with conflicting interests. Another way to look at a game is as a conflict that involves gains and losses between two or more opponents who all follow a set of formal rules.

In particular, game theorists study the predicted and actual behavior of individuals in specific games, as well as the optimal strategies used in the games. Thus, the principles of game theory can be applied to games such as cards, checkers, and chess; or, they can be applied to real-world problems in economics, politics, psychology, and even warfare. For example, game theory is used to determine optimal policy choices of presidential candidates, or even to analyze major league baseball salary negotiations.


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