Game theory

Game theory brings a new meaning uncertainty. Earlier theories accepted uncertainty as a fact of life and did little to identify its source. Game theory says that the true source of uncertainty lies in the intention of others. – Peter L. Bernstein, Against The Gods, The Remarkable Story of Risk

Game theory is the study of strategic decision making. More formally, it is “the study of mathematical models of conflict and cooperation between intelligent rational decision-makers.”

Game theory is mainly used in economics, political science, and psychology, as well as logic and biology. The subject first addressed zero-sum games, such that one person’s gains exactly equal net losses of the other participant(s).

Modern game theory began with the idea regarding the existence of mixed-strategy equilibria in two-person zero-sum games and its proof by John von Neumann.

John von Neumann