This edition has expanded coverage of the hold-up problem, unverifiable investments, up-front contracting, and option contracts.



New- Chapter on General Assumptions and Methodology : This added chapter provides an overview of how mathematical models can be used to predict how people will behave in strategic situations. New- Guided Exercises Game theory is best mastered by problem solving, and Strategy, Second Edition, has numerous end-of-chapter exercises. A "guided exercise" has been added to each chapter to help students understand how to approach and work through problems. New- Topics for Political Economists and Political Scientists : This Second Edition includes new sections on the median voter theorem and candidates’ equilibrium policy locations, strategic voting, multilateral bargaining in legislatures over proposals and amendments to new laws, and information aggregation and jury deliberations. More on Contracting and Contract Enforcement : A wide range of interesting strategic behaviour relates to the formation and enforcement of contracts, and Strategy.