Behavioural studies of strategic thinking in games

Abstract

Game theory is a mathematical language for describing strategic interactions, in which each player's choice affects the payoff of other players (where players can be genes, people, companies, nation-states, etc.). The impact of game theory in psychology has been limited by the lack of cognitive mechanisms underlying game-theoretic predictions. ‘Behavioural game theory’ is a recent approach linking game theory to cognitive science by adding cognitive details about ‘social utility functions’, theories of limits on iterated thinking, and statistical theories of how players learn and influence others. New directions include the effects of game descriptions on choice (‘framing’), strategic heuristics, and mental representation. These ideas will help root game theory more deeply in cognitive science and extend the scope of both enterprises.