Game theory
branch of mathematics focused on strategic decision making / From Wikipedia, the free encyclopedia
Game theory is the study of how and why people make decisions.[1][2][3] (Specifically, it is "the study of mathematical models of conflict and cooperation between intelligent rational decision-makers".)[4] It helps people understand parts of science and politics. An alternative term suggested "as a more descriptive name for the discipline" is interactive decision theory.[5]
In the Cold War period, the strategic decisions of the United States and the Soviet Union were sometimes viewed as an exercise in game theory.[6] In that case the "players" being studied were the United States and the Soviet Union.[7][8]
Game theory is not just about games, but how and why businesses make decisions, and just about any decision based on valuing likely outcomes.[9] In game theory, all of these situations are "games" since the people involved make choices based on how they value the possible outcomes of the choices. This is true even of cases where the decisions of a single person only affect that one person.
Game theory is found in the financial choices people make, and is found in the study of economics.[10]