PROFESSOR DAVID EPSTEIN

719 IAB, 854-7566

DE11@COLUMBIA.EDU

Increasingly, political scientists are using game theory to analyze strategic interactions across many different political settings. Each of the four major subfields, to differing degrees, has seen game theoretic concepts enter its vocablulary, and students entering the profession will need to understand the potential and limits of game theory. This course aims to give students an entry-level understanding of the basic concepts of game theory, and how these concepts have been applied to the study of political phenomena. Students should leave the course with a working knowledge of games of complete information, to the point where they can state a model correctly, solve it, and elucidate some of the theory's empirical implications.

Institutional analysis lies behind much of modern positive political theory, so we will combine our study of pure game thoery with a study of certain key political institutions. The institutions we will be examining within this course are legislatures, legislative committees, courts, and treaties, among others. Among the topics to be studied within these "institutional laboratories" are strategic voting, coalition formation, agenda setting, and the provision of public goods. This is primarily a methods course. I will focus my attention on providing you with the tools to analyze systematically strategic situations in politics, broadly defined. The policy making examples we examine are meant to be illustrative, rather than providing the primary focus of the course. Therefore, the course is divided into sections along analytical methods lines, not substantive policy area or institutional lines.

This course will require careful and systematic reasoning on your part. There will be a fair amount of algebra, and perhaps some simple calculus. It is also helpful to know something about basic probability theory. This course is designed to give you a firm grounding in the included topics specifically and positive political theory generally and to serve as a launching pad for further study. The continuation of this course is G4210, which is a topics course and is correspondingly organized according to areas of substantive interest.

Reading Materials:

There are five texts required for the course:

(1) Dixit, Avinash, and Barry Nalebuff, Thinking Strategically: The Competitive Edge in Business, Politics, and Everyday Life (New York: W. W. Norton & Company, 1991);

(2) Ordeshook, Peter, Game Theory and Political Theory (New York: Cambridge University Press, 1986);

(3) Binmore, Ken, Fun and Games (Lexington: DC Heath, 1992);

(4) Riker, William, Liberalism Against Populism (Prospect Heights: Waveland Press, 1982); and

(5) Kreps, David, Game Theory and Economic Modeling (Oxford: Oxford University Press, 1990).

These are all available at the Bookstore. I will also be assigning articles to be read for most classes. These will be available in a bound reader form at the Village Copier on 115th Street. I will have it photocopied on two sides in an attempt to cut down on the bulk as well as the cost.

Assignments:

I will assign a number of problem sets throughout the semester. These are designed both to test your understanding of the material as well as to let you explore how these tools can be applied to more realistic political decision making situations. There is likely to be a question on each set that either asks you to indicate how you would approach a particular modeling problem, or asks you to give an example of a particular strategic concept from your own field. The problem sets will count for 40% of your final grade.

Students will be required to write a paper for this class. Students should choose simple questions to be addressed -- extensions of existing models make good topics for these papers. All students will be required to turn in to me a brief (two page) paper proposal by Thanksgiving. The papers count for 60% of the final grade.

Week 1: September 3

PRELIMINARIES, EXAMPLES, INTRODUCTION TO GAMES & BACKWARD INDUCTION

Readings:

• Fun and Games, Chapter 0
• Thinking Strategically, Chapter 1
• Game Theory and Economic Modeling, Chapters 1 and 2
• Aumann, "Game Theoretic Analysis of a Bankruptcy Problem from the Talmud" (JET 36: 195/CR)
• Riker, "The Future of a Science of Politics" (Amer. Beh. Sci. 21: 11/CR)

Week 2: September 10

SEQUENTIAL GAMES

Readings:

• Fun and Games, pp. 23-41
• Thinking Strategically, Chapter 2
• Game Theory and Economic Modeling, pp. 13-20
• Bueno de Mesquita and Lalman, "The Road to War Is Strewn with Peaceful Intentions" (Ordeshook, Models of Strategic Choice in Politics/CR)

Week 3: September 17

SIMULTANEOUS GAMES

Readings:

• Fun and Games, Chapter 4
• Thinking Strategically, Chapters 3-5
• Game Theory and Economic Modeling, pp. 10-13, 21-36
• Game Theory and Political Theory, Chapter 5

Week 4: September 24

UNCERTAINTY, COORDINATION, AND MIXED STRATEGIES

Readings:

• Fun and Games, Chapters 3 and 6
• Thinking Strategically, Chapters 6 and 7
• Game Theory and Economic Modeling, Chapters 4 and 5

Week 5: October 1

REPEAT PLAY AND THE EVOLUTION OF COOPERATION

Readings:

• Fun and Games, Chapter 8
• Bendor, "In Good Times and Bad: Reciprocity in an Uncertain World" (AJPS 31: 531/CR)
• Kreps, "Corporate Culture and Economic Theory" (Alt & Shepsle, Perspectives on Positive Political Economy/CR)
• Milgrom, North and Weingast, "The Role of Institutions in the Revival of Trade: The Law Merchant, Private Judges, and the Champagne Fairs" (E&P 2: 1/CR)

Week 6: October 8

THE ARBITRARINESS OF MAJORITY RULE

Readings:

• "Notes on Social Choice Theory" (CR)
• Liberalism Against Populism, Chapter 5
• Game Theory and Political Theory, pp. 166-175; 243-266
• Plott, "A Notion of Equilibrium and Its Possibility Under Majority Rule" (AER 57: 787/CR)
• McKelvey, "Intransitivities in Multidimensional Voting Models and Some Implications for Agenda Control." (JET 12: 472/CR)

Week 7: October 15

MODERN SOCIAL CHOICE THEORY

Readings:

• Game Theory and Political Theory, pp. 73-82
• Epstein, "Uncovering Some Subtleties of the Uncovered Set" (CR)
• Cox, "Centripetal and Centrifugal Incentives in Electoral Systems" (AJPS 34: 903/CR)
• Myerson, "Incentives to Cultivate Favored Minorities Under Alternative Electoral Systems" (APSR 87: 856/CR)

Week 8: October 22

PREFERENCE ORDERINGS, THE CONDORCET PARADOX, AND SOPHISTICATED VOTING

Readings:

• Game Theory and Political Theory, pp. 266-284
• Thinking Strategically, pp. 267-285
• Liberalism Against Populism, Ch. 6, and pp. 65-81
• Krehbiel and Rivers, "Sophisticated Voting in Congress: A Reconsideration" (JOP 52: 548/CR)
• Austen-Smith, "Sophisticated Sincerity: Voting over Endogenous Agendas" (APSR 81:1323/CR)

Week 9: October 29

UTILITY FUNCTIONS, EUCLIDEAN PREFERENCES, AND THE MEDIAN VOTER THEOREM

Readings:

• Game Theory and Political Theory, pp. 16-52; 160-166
• Thinking Strategically, pp. 259-264
• Liberalism Against Populism, Chapter 3
• Osborne, "Spatial Models of Political Competition under Plurality Rule" (Can. Jour. of Ec. 2: 261/CR)
• Romer and Rosenthal, "Political Resource Allocation, Controlled Agendas, and the Status Quo." (PC 33: 27/CR)

November 5: No Class (Election Day!)

Week 10: November 12

APPLICATIONS OF THE SETTER MODEL

Readings:

• Shepsle, "Institutional Arrangements and Equilibrium in Multidimensional Voting Models" (AJPS 23: 27/CR)
• Ferejohn & Shipan, "Congressional Influence on Bureaucracy" (JLEO 6: S1/CR)
• Krehbiel, "A Theory of Divided and Unified Government" (CR)
• Epstein and O'Halloran, "Administrative Procedures, Information, and Agency Discretion." (AJPS 38: 697/CR)

Week 11: November 19

INCOMPLETE INFORMATION

Readings:

• Fun and Games, Chapter 11
• Ferejohn, "Incumbent Performance and Electoral Control" (PC 50: 5/CR)
• Nalebuff, "Rational Deterrence in an Imperfect World" (WP 43: 313/CR)
• Gilligan and Krehbiel, "Collective Decisionmaking and Standing Committees: An Informational Rationale for Restrictive Amendment Procedures" (JLEO 3: 287/CR)

Week 12-13: November 26, December 3

SEQUENTIAL BARGAINING

Readings:

• Fun and Games, Chapter 5
• Thinking Strategically, Chapter 11
• Baron and Ferejohn, "Bargaining in Legislatures" (APSR 83: 1181/CR)
• Baron, "A Spatial Bargaining Theory of Government Formation in Parliamentary Systems," (APSR 85:137/CR)