ABSTRACT
A new concept of equilibrium, in which the rules of play allow for sequences of moves and countermoves after initial strategy choices are made in normal-form or matrix games, was introduced in Chapter 4. The analysis of sequential play reflects the view that most real-life games are ongoing and do not necessarily terminate after the players make their initial strategy choices. In fact, if these choices leave a player in a position that it could improve upon, either by itself or by inducing subsequent moves by other players, then the rules of (nonsequential) games seem unduly restrictive. They preclude the analysis of some commonly recognized empirical phenomena, such as jockeying for a favorable position in the early phase of extended negotiations so as to be in a more advantageous position later.
