Game theory-stag-hunt game

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Game Theory (Stag-Hunt Game): N players go hunting; each can choose to hunt either stag or hare, so the set of actions available to each player is {S,H} (S stands for hunt stag, H stands for hunt hare). If all N players hunt S, then each gets payoff 2. If any players hunt hare, then each hare-hunter gets payoff 1, while all stag-hunters get zero. (Interpretation, the stag is only caught if all N players work together).

(a) Suppose first that N = 2 (i.e., that there are two players). Write out the payoff matrix.

(b) Now let N = 3: Show that it is not a Nash equilibrium for 2 players to choose S, and one player to choose H: specifically, show that if this is what players plan to do, and if all players correctly anticipate it, then somebody can improve his payoff by changing only his own action.

Reference no: EM13983970

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