P2

P1

Confess

No

(-1,-1)

Confess

(-5,0)No

(0,-5)(-3,-3)

TABLE 1 Battle of Sexes and Prisoner’s Dilemma

Prisoner’s Dilemma

Husband

Wife

Basket-ball

Opera

(3,1)

Basketball

(0,0)Opera

(0,0)(1,3)

Battle of Sexes

9

TABLE 2 Matching Pennies and a Basic Dynamic Game

Dynamic Game

P2

P1

H

T

(-1,1)

H

(1,-1)T

(1,-1)(-1,1)

Matching Pennies

P2

P1

(2,1)

RL

l r

(0,0)

(1,2)

10

Payoffs

S

LIn

Out

(0,0,0)

In

(-5,1,3)Out

(-5,1,3)(-3,3,5)

CB: In CB: OutS

LIn

Out

(0,0,0)

In

(0,0,0)Out

(0,0,0)(-3,3,4)

Outcomes

S

L

In

Out

OUT

In

Out

IN

CB: In CB: OutS

LIn

Out

OUT

In

OUTOut

OUTININ (price war)

IN (price war)

TABLE 3 Access Game

11

Players

Payoffs• UCB=FCB(efficiency, safety, other public issues)

• UP=FP(own efficiency and profitability)

• UE=FE(own consumption and leisure)

Description

Strategies

• Central Bank (CB)

• Participants (P)

• End-users (E)

• CB: set the fees to the participants

• P: set the fees to end-users

• E: set the number of transactions to the system

TABLE 4 Vertical Pricing game: Setup

12

TABLE 5 Vertical Pricing game: Nash Equilibrium

13

FP

FE

FP(FE)

NE of the game FE(FP)

A