This course is designed for students with a background in microeconomic theory and will be taught at the intermediate level. The topic of this course, Game Theory, is an essential tool for analyzing strategic interactions between economic agents. It can help us explain anything from why farmers overgraze a common piece of land to the price at which a buyer and seller agree to trade. This course equips students with the skills to use game theory to model real world scenarios and apply game theoretic methods to solve these models.<br>As will be seen, in many games like the Prisoner's Dilemma, game theory predicts suboptimal outcomes, since each agent acts in their self-interest, which may not be the common interest. One way to escape this is to allow agents to write binding contracts with each other, which enables us to shift the focus from strategies to payoffs. We take a brief venture into cooperative game theory to see how agents will split the gains from forming coalitions.<br>One common application of game theory is to bargaining. This pertains to any situation whereby two or more agents have an incentive to reach a mutually beneficial agreement, but conflicting interests over the terms of such an agreement. Students will see some of the myriad of situations bargaining theory can be applied to and learn what predictions bargaining theory can help us make about how these situations will be resolved.