Corso di laurea magistrale in Filosofia

Knowledge of mathematics at high school level, and interest in understanding human rationality. The course is open for students from all disciplines and also interesting for continentally oriented
philosophers.

The course introduces students to the essential elements of decision theory, expected utility theory, game theory and their applications to understanding human interaction in society (e.g., altruistic behavior, the concept of fairness, the breakdown of negotiations, emergence and decline of social norms). More broadly, the course familiarizes students with modern theories of instrumental rationality which are contrasted to empirical evidence and rivalling philosophical theories of rationality (e.g., Kantian accounts). They learn to evaluate human actions using the tools of decision and game theory and at the same time, they learn how to evaluate those theories critically and to identify their scope and limits.

Students obtain a clear understanding of what it means to decide and to behave rationally, and to give a critical evaluation of the scope, success and limits of theories of rational choice. They understand the technical foundations of rational choice and game theory and can apply these theories to real-world phenomena.

Mixture of lecture and seminar. Active partecipation in discussion is a prerequisite for passing the course.

Essay (ca. 3,000 words) and written exam. These two elements count equally toward the final grade (45%
each). The remaining 10% of the grade is determined on the basis of contributions in class.

Part I: Instrumental Rationality and the Concept of Utility

Week 1: The concept of utility in the British philosophy of the 18th and 19th century (Hume, Bentham,
Mill), and its impact on the modern concept of instrumental rationality. Contrast with Kantian conceptions of rationality.

Week 2: Weber's typology of different types of rationality. Discussion of the scientific character of impersonal  comparisons of utility (Robbins vs. Harsányi).

Part II: Decision Theory

Week 3: The concept of value or utility function. Statement and proof of the van Neumann-Morgenstern
representation theorem for expected utility maximization. Criticism of the underlying axioms (Allais' paradox). Risk aversion and prospect theory (Kahneman and Tversky).

Week 4: More abstract representation results. Statement and proof sketch of Savage's representation
theorem for expected utility maximization. Critical discussion of the underlying axioms and the Sure-
Thing Principle in particular (Ellsberg' paradox). Non-probabilistic decision rules.

Part III: Game Theory and Social Norms

Week 5: Introduction to game theory and its central concepts such as dominant strategies, Nash equilibria, backward induction, etc. Different kinds of Nash equilibria (e.g., pure and randomized ones), and their interpretations.

Week 6: Applying game theory to explaining altruistic behavior cooperation. Criticism and limitations of
game theory. The evolutionary interpretation of game theory.

The book edited by Hargreaves-Heap is an overall introduction to the course topics and provides a good
glossary for terms, too. We won't use it in the class, but it is a good background reading. Gilboa's book provides a good background reading for the formal parts of the course.

Participation in the classes is obligatory. There is no exam for "non-frequentanti".