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Abstract
Game theory provides a framework for analyzing problems when there are a small group of
participants. This is unlike the economic model of perfect competition, which requires several
participants. Game theory began as a way to analyze parlor card games, but has developed into
a rigorous analytical technique for evaluating strategic interactions. These interactions could be
between hostile countries, competing companies, or between a shipper and railroad. In fact, game
theory provides a useful structure for analyzing the interactions between a shipper and a railroad.
This paper models such interactions.