Game Theory in Economics and Business Decision-Making

Abstract

Game theory is an important branch of mathematics that studies strategic interactions among individuals, businesses, and organizations where the outcome of one participant depends on the actions of others. It provides a mathematical framework for analyzing competition, cooperation, negotiation, and decision-making in economics and business environments. Modern economic systems and business strategies often involve situations in which firms, consumers, and governments must make decisions under conditions of uncertainty and interdependence. the concept of game theory and explores its applications in economics and business decision-making. It discusses major concepts such as strategic games, Nash equilibrium, zero-sum and non-zero-sum games, cooperative and non-cooperative games, and payoff matrices. the role of game theory in pricing strategies, market competition, auctions, negotiations, advertising, supply chain management, and investment decisions. Furthermore, the importance of game-theoretic models in understanding consumer behavior, corporate strategy, and economic policy formulation. Through this study, it becomes evident that game theory serves as a powerful analytical tool for improving decision-making and strategic planning in modern economic and business systems.