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11. How to Solve for Perfect Bayesian Equilibrium: Example 1 (Game Theory Playlist 10)

In this episode we apply Requirements 1-4 that we learned in episodes 5-10 to solve for perfect Bayesian equilibrium. The game we use here is simple in the sense that it is not a game of incomplete information. It is in fact an extensive game with complete but imperfect information. This example demonstrates that we can apply PBE idea to any extensive form game and get rid of some unwanted Nash equilibrium. We also discuss how SPNE, NE and PBE are related. It's crucial to watch lecture videos in the proper order to ensure effective learning. This is because the concepts in each video build upon those introduced in previous videos. To help you with this, I recommend visiting my website, www.selcukozyurt.com, for a recommended course outline.