Application of Game Theory to Business Strategy

Iryna Heiets, Tamara Oleshko and Oleg Leshchinsky

A chapter in Business and Management Annual Volume 2023 from IntechOpen

Abstract: Game theory is the most popular mathematical tool, the spheres of application of which are economics, finance, management, politics, and military science. The game theory is a multifaceted phenomenon, which, despite being theoretical in nature, highly affects real-life business situations. This article briefly reviews the literature regarding game theory and business and introduces the basic concepts of game theory within the context of business strategy. The authors seek to provide insights into the winning business strategy which includes the elements of competition and cooperation. They determined the main rules of the sequential and parallel interaction in the game. Likewise, the authors focused on the prisoners' dilemma and highlighted two obvious alternatives that managers can use to ensure compliance with agreement. The four characteristics of a successful business strategy were presented as a prerequisite for decision-making using game theory.

Keywords: game theory; business; prisoners' dilemma; strategy; cooperation; competition (search for similar items in EconPapers)
JEL-codes: M00 M2 (search for similar items in EconPapers)
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.intechopen.com/chapters/87213 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ito:pchaps:319022

DOI: 10.5772/intechopen.111790

Access Statistics for this chapter

More chapters in Chapters from IntechOpen
Bibliographic data for series maintained by Slobodan Momcilovic ().