The Game theory, like other mathematical models in economics examines economic phenomena, focusing on selected, relevant factors. The term "game" have been chosen due to the fact that a methodology reduces and often complicates research structure to what appears like a cooperative games. As a result, we receive simplified representation of the research process. A good model illuminates the underlying forces that are not clearly visible when we take a look into detail beyond the surface. The theoretical conclusions of the model can be applied in practice to every day cases in order to improve our understanding on various strategic issues, etc.
Conservative economics methodology assumes that a participant who has no control over external variables, or more participants can not by any of its individual action to affect the operations of another participant. This traditional methodology ignores the influence of the individuals’ actions, the other (s), and vice versa. Von Neumann and Morgenstern (1944) were the first researchers who applied game theory to economics, recognizing the importance of interaction between the participants in an economic process. The essence is based on multilateral decision-making. Thus, the methodology is applied in situations where individuals and/or companies operate on interdependent, competitive surrounding.
The aim of this paper is to present the methodology of "game theory" to demonstrate how it can improve our understanding of studied phenomena, and define its possible application in the art of tourism research.
The article is organized into two main parts, in the first we examine key concepts theory, where we discuss the concept of "players", "information", "utility", "solutions" and "balance." In the second section we present several hypothetical case studies in the tourism sphere, whose methodology can lead to resolution not offered by other approaches, previously applied in the field.


Key words

Game Theory, Multilateral Decision-Making, Tourism Management, Mathematical Models



Akerlof Brandenburger, A. and Dekel, E. 1993. Hierarchies of beliefs and common knowledge. Journal of Economic Theory, 59 (l), 189-198

Eatwell, J., Milgate, M. and Newman, P. 1987. Game theory. New York: W. W. Norton & Company, Inc.

Fudenberg, D. and Levine, D. 1992. Maintaining reputation when strategies are not observed. Review of Economic Studies, 59 (3), 561-579

Glover, R., Glover, L. and McMillan, C. 1982. The passenger-mix problem in the scheduled airlines. Interfaces, 12, 73-79

Harsanyi, J. 1967. Games with incomplete information played by 'bayesian" players. i: The basic model. Management Science, 14, 159-182

Harsanyi, J. 1968a. Games with incomplete information played by "bayesian" players. ii: The bayesian equilibrium points. Management Science, 14,320- 334

Harsanyi, J. 1968b. Games with incomplete information played by "bayesian"players.: The basic probability distribution of the game. Management Science, 14, 486-502

Nash, J. 1950. Non-cooperative games. Annals of Mathematics, 54,286-295

Salak, J. 1991. Free rooms at the inn are out. Conde Nast Traveler, 26,28

Schwartz, Z. 1996. A dynamic equilibrium pricing model: A game theory approach to modeling conventions’ room rate. Tourism Economics, 2 (3), 251-264

Schwartz, Z. 1997. Research: Game Theory: Mathematical Models Provide Insights into Hospitality Industry Phenomena. Journal of Hospitality & Tourism Research February 1997 vol. 21 no. 148-70

Shubik, M. 1984. Game theory in the social sciences--concepts and solutions. Cambridge, Massachusetts: MIT Press

Stackelberg, H. 1934. Marketform und Gleichgewicht. J. Springer Berlin. Translated by Alan Peacock (1952) as The theory of the market economy. William Hodge, London

Tapper, R., Font, X. Tourism Supply Chains. 2007. http://www.icrtourism.org/documents/TourismSupplyChainsfinalreport31January2004.pdf (accessed February 17, 2007)

Von Neumann, J. and Morgenstern, 0. 1944. The theory ofgames and economic behavior. Wiley, NY

Weatherford, L. and Bodily, E. 1992. A taxonomy and research overview of perishable-asset revenue management: Yield management, overbooking and pricing. Operation Research, 40 (5). 831 - 843

Wie, B.W. 2005. A Dynamic Game Model of Strategic Capacity Investment in the Cruise Line Industry. Tourism Management, 26: 203-17

Witt, S. F., and C. A. Witt 1992. Modeling and Forecasting Demand in Tourism. London: Academic Press

Witt, S. F., H. Song, and P. Louvieris 2003. “Statistical Testing in Forecasting Model Selection.” Journal of Travel Research, 42: 151-158


Full Text: PDF (Bulgarian)