on 21 December 2005
This book is on strategic thinking. This is what you normally understand as game theory today. Game theory have become a mayor scientific discipline. After two Nobel prices it is a normal standard in economics. Dixit and Nalebuff describe the basics in game theory on a low level. They do not need to use mathematical equations to explain the context. The examples in this book are taken from politics, business and sports. There common model is the prison dilemma case. From this starting point they explain the various forms of co-operative behaviour to solve the games in life. The final result is to find a co-operative outcome with strategic moves. There are a lot of case studies in this book. It makes it easier to follow there ideas.
They show how deterrence was a good instrument in the cold war. They explain how a thread in business is taken on and when the thread is credible it is a good strategy to deter a potential competitor.
It is a book for everyone who is interested in strategic thinking. For the manager it is a good book for bargaining situations.
I read the book with pleasure because it makes business very simple and it is a joy to read.
on 10 June 2015
After deciding what to read next on my adventures, I was recommended to read Thinking Strategically. Now, after reading (I still haven't finished yet about 1/2 way through), this book has already helped me. It has saved money, and helped my game theory knowledge which was non-existent before reading. This book, once you get started is hard to put down, and anything mentioned applies wherever you go, and whatever you do! (don't want to ruin it too much) both authors of this book, also have their own personal experiences in this book, as well as well known examples. A Must read, should you want to learn more about game theory, and outwit everyone else!
on 11 July 2012
Quite a complex book, so not light reading, but very interesting. I look forward to using some of the methods, and see what the impact is. Definately a book for people who want to seriously learn about startegic thinking. If you put the book down, you'll have to re-read some to understand/follow the ideas, or is that just me?
"Strategic thinking is the art of outdoing an adversary, knowing that the adversary is trying to do the same to you." So begins Dixit and Nalebuff's guide to gaining the competitive edge. They intend this book for "businessmen," politicians, football coaches and parents--anyone who contends with an adversary. Their goal is to teach readers about game theory, the "emerging science of strategy," without jargon or mathematical formulas.
They begin with "ten tales of strategy" from a variety of settings. Using examples from sports, politics, history--and even a children's fairy tale--the authors illustrate the pervasive need for strategic thinking. Successive chapters present aspects of strategic thinking and explore their variations. Initial chapters address anticipating a rival's response, seeing through a rival's strategy, and adopting the best strategy in the cooperate-or-betray game of the Prisoner's Dilemma.
The authors then explore the art of making strategic moves, actions "...designed to alter the beliefs and actions of others in a direction favorable to yourself." We learn about unconditional moves as well as threats, promises, warnings and assurances. Succeeding chapters explain the value of making credible commitments, of sometimes being unpredictable, and of "playing chicken" with brinksmanship. We learn the relative strengths of cooperative and competitive strategies and how to choose between them. The final three strategy chapters explore the possible moves when adversaries are voting to make decisions and how to make the best use of bargaining positions and incentives.
There are numerous brief examples throughout the book. Each strategy chapter closes with a more elaborate case study to be analyzed using the chapter's principles. The final chapter is a collection of 23 fresh case studies that serve as a "comprehensive final exam" by drawing on strategies from all chapters. The authors achieve their goal of a readable, nontechnical introduction. They even lead us into some minimally-painful use of decision trees and contingency tables.
I recommend the book as a serious introduction to strategic thinking. Well, perhaps the occasional cartoon it includes disqualifies it as "serious." But its lessons prepare readers to act strategically in serious, real-life situations. Reading it is a good move.