Game Theory and the Market

We show that both cooperative and non-cooperative game models can sub-stantially increase our understanding of the functioning of actual markets. In the first part of the paper, we provide a brief historical sketch of the differences and complementary between the two types of models, by going back to the work of the founding fathers, Von Neumann, Morgenstern and Nash. In the second part, we illustrate our main point by means of examples of bargaining, oligopolistic interaction and auctions.