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CH 3 Game Theory, G1 (Loren, Trang, Jennie, Erica, Oyuka, Poe Poe, Silvia)…

- - - - Real Power= Taking the next step
  - - - New Mindset & a jumping-off point
  - - - Value Net
        
        Customers, Suppliers, Complementors and Competitors
        
        Useful for any business to identify all the players and relationship, employing the Value Net
        
        Describing the cast of players and diagram fortheir relationship
  - - - Determinations of power in game and big payoffs.
    - - The way of the game is played
        
        No universal set of rules/ From customs, contracts or law
        
        Putting rules makes a big difference in the way of a game is played out.
    - - Any game is affected by different ways, different people perceive the situation.
        
        Fundamental part of the game
        
        Altering players' perceptions= Alter the moves they make
      - Devices used to shape perceptions = Tactics
      - Led us into the discussion of the boundaries
        Scope of the Game
        
        People often analyze games in isolation, each game is invariably linked to each other.
        
        To understand what's going on, need to consider the links
    - - Players, Added Value, Rules, Tactics and Scope
        
        Elements seem to be overlapped as they depend so closely on each other
        
        These are not be neglected
- - - - 26 red cards
        
        Added value: 2600
    - - 23 black cards
        
        Added value: 2300
    - - 26 red cards
        
        Added value: 0
        
        Barry has any claim
    - - 26 black cards
        
        Added value: 2600
        
        It's symmetrical
  - - - How much Adam stands to lose without you :check:
      - How much worse off you'd be without Adam :green_cross:
    - - Individual added value
      - Group's added value
- - - - To figure out the price at which your partner would be equilly happy to buy or sell
        
        Example
        
        Suppose you value the venture at $100$, your partner value at $60 million
        
        :red_cross:if you offer $50 million
        
        Your partner prefer to sell and you pay $50 million for his share
        
        If you offer $31 million :check:
        
        Your partner prefer to sell and you pay $31 for his share
    - - Encourage your partner to shoot first
        
        Example
        
        Suppose you value the venture at $100 million, your partner's perception is unknown
        
        Offer below $50million, buy
        
        Offer above $50 million, sell
        
        you net more than $50 million
  - - - the writer
      - the agent
        
        Didn't know about the studio's perception
      - the studio head
      - the lawyer of the studio
        
        Didn't realize about the scope of the game
      - the multimilliion dollar star
- - - - both be rational but perceive the game quite differently
        
        information
        
        perceptions
      - :silhouette:Example
        
        salesman
        
        he cut prices to the point of destroying profits
        
        change the bonus compensation system
        
        :question:How
        
        trying to understand what motivates other person
        
        :star:look at the game from multiple perspectives
- - - - Only Adam can make offer
      - Is it possible?
    - - Many rules to governing negotiation in business
        
        Take-it or leave-it offer
        
        Reject
        
        Over
        
        Accept
        
        Deal done
        
        Contracts
        
        Custom
        
        Laws
- - - - Adam has 26 black card.
      - 26 students. Each of the students
        have 1 red card.
        
        Adam needs students as much as students need Adam.
        
        A 50/50 split
    - - Barry has 23 black card.
        
        It's a game of musical chair, and 3 students will be left out.
        
        Barry could propose a 10/90 split or even lesser.
      - 26 students. Each of the students
        have 1 red card.
      - Nintendo used this strategy to make lots of money in 1988.
      - NFL
        
        Deliberately restricting the number of team in the leauge.
        
        There are always more cities wanting teams than there are teams.
        
        Result: Local government subsidies to team at $500 million annually.
        
        Pros
        
        NFL and teams made a lots of money
        
        Cons
        
        As teams become less loyal to their hometowms, fans become less loyal to their teams.
- - - - Perceptions Put yourself in the shoes of other players to understand how they see the game.
- - - - :red_cross:Missing the link