game theory

Strategic Interaction and Empirical Models: An Application of Statistical Backward Induction to the U.S. Special 301 Report

While conventional statistical methods usually assume that the error  term in the models are independent and identically distributed (i.i.d.), this assumption is usually violated when observations are interdependent due to the strategic interactions among players. The violation of the i.i.d assumption results in the inefficient estimation of standard errors that can further invalidate the hypothesis testing. This paper discusses the method of statistical backward induction (SBI) developed by Curtis S.

Party Cooperation and Duverger’s Law: A Game-theoretical Analysis of Pan-Blue Alliance

This paper investigates the relationship between political party cooperation and Duverger’s Law. A theoretical model is build in order to demonstrate whether two party leaders would cooperate or not and therefore nominate only one candidate to campaign. The results shed light on how Duverger’s law is satisfied through pre-election coordination between political parties. Under three assumptions, Duverger’s law is satisfied. Otherwise, candidates of three political parties will run election under the plurality electoral system.

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