Thursday, June 23, 2005

Application of game theory

The FT has a superb example that can be appled to game theory. I have not thought it through this clearly as yet. However, I am sure that someone who knew more than the basics could use this to analyse the situation.

Lex live: Italy:

"Both companies are protected - if that is the word - by shareholder pacts among the great and the good. Mediobanca, for example, is 55 per cent owned by a group including leading banks, Fiat and Telecom Italia. If these pacts were solid, there would not be an issue. But the level of consternation evident in Italy suggests they are fraying, with each of the insiders worried that one of the others might crack and sell out first. "

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