Game Theory 101: Uncovering the Traps of Nash Equilibrium in the Stag Hunt

⭐ The video discusses the concept of Pure Strategy Nash Equilibrium in the context of the stag hunt game.

🦌 In the stag hunt game, two hunters have to coordinate and choose the stag hunting equipment to capture the stag, which is worth more meat than individual hares.

🐇 Alternatively, hunters can choose to hunt hares individually, which is easier but results in less meat.

🎯 The Stag Hunt game involves two players who can choose to hunt a stag or a hare.

🔀 The outcome of the game depends on the players' strategy choices and their knowledge of each other's choices.

✅ There is no strictly dominated strategy in this game, and the optimal strategy for each player depends on the other player's choice.

🎮 Nash equilibrium is introduced as a way to solve games and determine sensible outcomes.

🔄 Nash equilibrium only considers individual deviations, not group deviations, in determining stability.

😊 Once strategies are revealed and outcomes determined, there are no regrets and no need to change strategies.

Nash equilibria are found by determining if players can individually do better by changing their strategies

In the stag stag outcome, both players are satisfied and it represents the best possible outcome for both

🎮 There can be multiple Nash equilibria in a game.

🦌🐇 Player 1 hunting a hare and Player 2 hunting a stag is not a Nash equilibrium.

🔄 Both players have profitable deviations from the initial outcome.

🦌 The video discusses a scenario where one player is hunting a stag and the other player is hunting a hare.

⚖️ The Nash equilibrium is analyzed and it is shown that the current outcome is not a Nash equilibrium because player one has a profitable deviation.

🔀 The possible outcome where both players are hunting hares is analyzed, and it is concluded that neither player has a profitable deviation.

🎯 There are two Nash equilibria in the game where both players hunt a stag or both hunt a hare.

🔁 When unable to coordinate, the expectation of hunting a hare traps both players into an inefficient situation.

🧩 Nash equilibria are stable and no one regrets their actions, even if it's not always the most efficient outcome.