Game Theory Applications In The Airbus-Boeing Dispute

This study examines the intricate trade dispute between Airbus and Boeing which took place from the late 1970s all the way till 2021. By using game theory tools including Nash equilibrium, mixed strategies, Stackelberg competition and credible threats, I can explore the strategic trade decisions, such as tarif s, subsidies and complaints to the WTO, taken by each player and how this af ects the overall competitiveness and the health of the LCA sector. Each of these games use data from the real world in order to ef ectively depict the outcomes that could have arisen and those that actually happened. The key findings were able to illustrate how although some of the theoretical economic ideologies were used, the real life decisions still deviated from the stable outcomes due to external pressures and factors. The results provide us a more intricate understanding of the trade world and the economic environment of the LCA industry