Research Proposal on Game Theory

This project intends to analyze and adapt game-theoretical features to the findings of Behavioral and Experimental Economics. It aims, in its essence, to better describe human decision-making and strategic thinking; to merge some of the behavioral and psychological concepts into a flexible and hybrid model. It is not the objective of this project to negate or change the mathematical features of game theory, that, when seen as a branch of applied mathematics, are not incorrect. Instead, it is intended to adapt the game-theoretic tools to the object of study of economics (i.e., the agent), and to allow for the better understanding of human behavior, especially in situations of decision-making and strategic interaction. Hence, among the main features of this project, we highlight: (i) the introduction of a decision and behavior rule based not only on the expected utility theory, but on alternative theories, such as, prospect theory, social preferences, belief-based models, and reference-dependent preferences; (ii) the consideration of cognitive limitations, heuristics, anchors, and biases. Regarding the organization. On the first part, a critical literature review, and analysis is made. It follows a theoretical approach to simultaneous non-cooperative games, with the inclusion and/or modification of behavioral features. It develops as a natural extension the analysis in a dynamic context. Finally, some applications are made.