Game Theory: Stackelberg and Backward Induction

This lecture covers the concepts of Stackelberg games and backward induction in game theory. It begins with a review of extensive form games and introduces a card game example to illustrate the principles of game trees and Nash equilibria. The instructor explains how players can strategize using backward induction to determine optimal moves in sequential games. The discussion includes the definition of subgame perfect equilibria and how it applies to feedback games. The lecture also explores the implications of leader-follower dynamics in Stackelberg games, emphasizing the importance of rational reactions and the existence of Nash equilibria. Various examples are provided to clarify these concepts, including market monopolies and security games. The instructor highlights the practical applications of these theories in real-world scenarios, such as autonomous driving and adversarial learning. The session concludes with a summary of key points and a reminder of upcoming quizzes and exercises for further practice.