I’m excited to recommend Game Theory: An Introduction by Steve Tadelis as a textbook for undergraduates or as a self-study for mathematically inclined readers. Why am I so confident you’ll enjoy this book? One reason is that I just read the book from cover to cover and loved it. But there’s also another reason. It’s because this textbook is written by the professor whose game theory course I took at Stanford.

Steve Tadelis is currently an associate professor at the Haas School of Business at the University of California, Berkeley, and he is a distinguished economist at eBay Research Labs. His recent research about search ads (like Google Adsense) was featured in the Harvard Business Review Blog as well as The Economist. Another study about the role of information in auctions was separately covered in The Economist.

Game Theory: An Introduction is a rare treat: a mathematically precise treatment of game theory that is also fun to read. After completing the book, I reached out to Steve Tadelis who kindly agreed to answer a few questions about why he wrote the book and which readers would benefit from it. His answers are worth reading, and I thank him for doing this interview, which appears after the jump.

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"All will be well if you use your mind for your decisions, and mind only your decisions." Since 2007, I have devoted my life to sharing the joy of game theory and mathematics. MindYourDecisions now has over 1,000 free articles with no ads thanks to community support! Help out and get early access to posts with a pledge on Patreon. .

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1. What motivated you to write this textbook? (i.e. how is your book different from other textbooks already out there?)

[Tadelis] I never intended to write a textbook, or for that matter, any kind of book. Academic economists are rewarded and recognized for publishing academic papers, most of which have little impact beyond the five or ten other academics who read it. But I was unhappy with the textbooks that were available in the late 1990s when I taught Game Theory at Stanford. The course was very rigorous for an economics undergraduate class (which is probably why more than half the students were engineering, math and computer science students), making many textbooks inadequate. Of the few that were more adequate, either the loose definitions, the lack of clarity on the assumptions made, the dry style, or all of the above, made it clear to me that students would not get what I think they need from using them. So, after identifying Wendy Shue as a student who took meticulous notes, I asked her to just put her notes in a file, and that formed the basis of what I thought to use for notes in the near future. Every year afterwards I added material, and within 4 years I had about 250 pages of good, not great notes that I used for the course. But again, I had no intent and no incentive to turn them into a textbook, until Tim Sullivan, then from Princeton University press, convinced me that it would be worthwhile. The outcome is a book that, in my view, balances a friendly approach together with serious rigor. It also develops the material in a progression that, in my view, teaches game theory through the fundamentals of the assumptions we are making about the ability of players to reason, which differs from most undergraduate textbooks.

2. Game theory spans a lot of disciplines. Is this textbook only for economics students, or would it be useful for students in other subjects?

[Tadelis] I tried hard to include applications and examples from Political Science, another important application of Game theory, to make the book useful for advanced undergraduates and first year PhD students of that discipline. Because of the book’s rigor, I think it would be useful for Computer Science undergraduates, more of whom choose to learn game theory because of its emerging prominence in that discipline. Since a book can’t cover everything, I chose not to include evolutionary game theory, which some students of biology may be interested in, and hence, it is not suited for all disciplines.

3. The textbook does include many mathematical proofs (which I loved). What mathematical background is recommended for the reader?

[Tadelis] That is a hard question for me to answer. On one hand, the book requires familiarity with math, I would say at least a serious year of college math, or AP Calculus, just so that the reader is familiar with mathematical reasoning. But on the other hand, all I require is that the reader be able to apply mathematical reasoning, which is not easy for everyone, and not something that is taught well even in many college classes. I assume almost no prior knowledge and provide a sparse mathematical appendix to help the reader who has less of a background. I want to make it easy and, and the risk of sounding extra geeky, fun for the reader to appreciate the math and the rigor.

[Note from Presh: Chapter 2 of the textbook does introduce expectations and the required probability. However, I would recommend readers be familiar with probability, including Bayes Rules and be comfortable with expectations.]

4. Lately it seems everyone is talking about behavioral economics and how we are “irrational.” This textbook focuses on rationality. Why is it still important to study the rational agent model?

[Tadelis] Leo Tolstoy’s book Anna Karenina begins with the following: “Happy families are all alike; every unhappy family is unhappy in its own way.” This is true about rationality: Rational people are all alike; every irrational person is irrational in his or her own way. Rationality is well defined, clearly spelled out in assumptions, and lends itself to analysis well. Of course, I’m in my early fifties, married, and have two kids. Do I think that people are rational? Heck no! At the same time, I have little patience for those who say “no one is rational, we need to change the models…” and that is for a simple reason: despite being blatantly wrong, the rational choice based equilibrium models that economists use are very helpful in shedding light on many real world phenomena, both in theory and in practice. Before we throw away the baby together with the bathwater, I am convinced that is critical that social scientists understand the rational choice models well, and only then start taking the bold, yet often very narrowly applicable deviations from it to help us better understand the wide range of human behavior.

5. I remember in every class syllabus the professor would write down goals for what we could expect to learn. What are the goals of this textbook?

[Tadelis] If every one of your professors did this then you are luckier than most students! The goal of my textbook is to help anyone who is interested in carefully understanding what game theory is about, and who is curious enough to dive a bit deeper than just a rudimentary introduction, to do this while completely understanding the depth of assumptions needed to employ this powerful set of tools. And my personal goal was to do this with a style that would not cause people to dread every moment that they need to spend with the book.

6. I learned a lot while publishing my ebooks–specifically I appreciate how hard they are to write! What’s something you learned while writing the textbook–perhaps a new insight about game theory, something about the process of publishing a book, or just a fun fact you stumbled across while researching the book?

[Tadelis] I learned many things. First, unlike the rational players in my book, I learned that I am an even worse procrastinator than I thought I was, and for years (yes, seven to be exact) kicked myself for agreeing to write the book. I underestimated how much work it would take, and overestimated how motivated I would be to do the work. But that commitment, and reluctance to turn to the editor in defeat, kept me going, and I am grateful in hindsight that I did not quit. I doubt I’ll ever write another book by myself, and if I do agree to write one more, please shoot me. Second, I learned that perfection is the enemy of completion — there were so many more topics, or applications, that I thought I must include in the book. But at some point one has to balance that with a product that is “good enough” and covers what most people would use in a typical course. I guess that’s why so many textbooks are written and why so many more will be written: there is no such thing as the perfect book. Last but not least, I learned that I truly enjoy influencing the way people think and learn. When I receive feedback from someone who has used the book and who has enjoyed learning from it, I get this really nice fuzzy-warm feeling. Just don’t tell my rational, optimizing colleagues that I said that…

Thanks Steve Tadelis for the interview! You can get the textbook at Amazon: Game Theory: An Introduction (I’d recommend the print copy)

Closing note: Long-time readers will also remember that I recommended other game theory books, so let me clarify some differences. My ebook, The Joy of Game Theory, is a collection of some of the most interesting problems in game theory with practical examples. Another book I recommend, Game Theory 101 by William Spaniel, is a great introduction of the basic concepts in game theory. By contrast, the text by Tadelis, Game Theory: An Introduction is a rigorous textbook suitable for teaching an advanced college course. It’s covers material corresponding to the course I took at Stanford taught by Steve Tadelis. This is a great textbook that rigorously introduces game theory.