2023, Vol. 4, Issue 1, Part B
Use of game theory in competitive business theory
Author(s): Shivom Sharma
Abstract: Game theory, a mathematical framework for analyzing strategic interactions among rational decision-makers, plays a critical role in shaping competitive business strategies. In modern markets where firms continuously respond to the actions of competitors, game theory provides valuable insights into optimal decision-making under conditions of conflict, competition, and cooperation. This research paper explores the foundational concepts of game theory—such as Nash equilibrium, dominant strategies, and mixed strategies—and examines their practical applications in pricing, advertising, product launches, and market entry decisions. Real-world case studies from industries such as airlines, retail, and technology demonstrate how firms utilize game-theoretic models to anticipate competitors' moves and refine their own strategies accordingly. The study concludes by highlighting the advantages and limitations of game theory in dynamic and imperfectly competitive markets, while suggesting areas for future exploration, including behavioral game theory and AI-driven strategic simulations.
DOI: https://doi.org/10.22271/math.2023.v4.i1b.231
Pages: 160-163 | Views: 1244 | Downloads: 790
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How to cite this article:
Shivom Sharma. Use of game theory in competitive business theory. Journal of Mathematical Problems, Equations and Statistics. 2023; 4(1): 160-163. DOI: 10.22271/math.2023.v4.i1b.231
