# D.8 Subgame equilibrium | Game Theory – Microeconomics

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This video shows how to look for a subgame perfect equilibrium. We start by explaining what subgames are, then look for a Nash equilibrium, and finally look for the subgame equilibrium.

Related videos:

-Repeated games:

-Nash equilibrium:

Related articles:

-Nash equilibrium:

-Game theory:

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That's spectacularly wrong, please delete this video!

wrong explanation

how to do a 3×3? game

stnankk

wrong

thank you very much. It was helpful

good

7 subgames correction

The normal form representation of the game is absolutely wrong. Player 2 must have 4 strategies. L & R are only the actions of player 2, his strategies are LL, LR, RL & RR.

why will player 1 choose (3,1)? I didn't understand as up is the dominant strategy for him then why will he choose down ? and why not (5,2) ?

This was amazing.

It finally clicked for me. Thank you, that was well organized and precise.

Hi

according to the solution you show that the sub-game perfect is not Nash equilibrium

D, R in the table. But according to my understand subgame perfect MUST be nash for the initial game

I think your table should have been built with 4 columns LL LR RL RR then you could see that 3,1 is a nash equilibrium

for the game and it is also subgame perfect.

the solution should be

D, LR which means down for player 1 and Left if player 1 choose Up and Right if he choose Down

+ Policonomics, I have a quick question. If the problem can be solved by a 2 X 2 table, then why do we need use to go for a decision tree ? We could have drawn a 2 X 2 table and calculate nash equlibria and solved it.

very interesting! enjoyed it