Publisher's Synopsis
Seminar paper from the year 2003 in the subject Economics - Macro-economics, general, grade: 1,3, London School of Economics, 7 entries in the bibliography, language: English, abstract: Binary choices with externalities are discussed in the following chapters. After a general introduction of binary choice with externalities and collective action games, the basic game theoretical models are extended to multi-person settings. The prisoner's dilemma, the game of chicken as well as the assurance game are applied to real-life examples. More complicated settings of collective action games are introduced by advanced models of Schelling(1978). Finally, possible solutions to collective action games are shown.
