Does " Game Theory" work for gambling and stocks ??

Question

which is the math needed for GAME THEORY ?

also does this game theory work in gambling or games that have an element of 'luck' or do they only work for strategic games =?? (Chess)

Answer 1

You don't need much math beyond simple algebra to appreciate some basic insights of game theory--Schelling got the Nobel Prize in economics for the simple but insightful models of The Strategy of Conflict. On the other hand much modern work uses advanced math such as fixed-point theorems. There are many good textbooks that give an idea of what is used. My favorite is A Course in Game Theory by Osborne and Rubinstein, at the advance undergrad or early grad student level.

Game theory does work on games of chance, as long as there is a strategic element (what the other guy does matters to you), so for example Poker is one game that can be analyzed. Indeed, von Neumann and Morgenstern axiomatized expected utility to deal with chance elements. A very simple but revealing discussion of the issue is in How to Take a Chance by Huff and Geis (who brought you How to Lie with Statistics).