Game theory was developed by big-brained people attempting world domination. For their efforts, they earned Nobel Prizes and a screaming throng of teenage fans à la mid-1960s Beatles. (OK, maybe just the first, but it’s worth picturing hysterical fans throwing underwear while chanting Nash! Nash! Nash!)
Basically, game theory attempts to explain how people act in competitive or collaborative situations. And, more usefully in pursuit of said world domination, it also attempts to define your best strategy in light of your opponents’ likely actions.
Be Nice, but Not Too Nice: Game Theory Says So
In real-world relationships, rarely is there only one chance for trust or betrayal. So what’s our best strategy over the long run? To answer this question, the game theorist Robert Axelrod held a Prisoner’s Dilemma tournament. Each pair of players played two hundred rounds of the dilemma, trying to accumulate low jail sentences over these rounds.
The best strategy was called Tit for Tat. In it, the player cooperates the first round and then mimics the other player every move thereafter. In Axelrod’s tournaments this strategy eventually created predictability and cooperation, allowing both players to consistently earn a string of six-month sentences for keeping their mouths shut.
From the tournament, Axelrod drew the following rules, which provide good commonsensical advice for many interactions, inside and out of games:
Be Nice: cooperation benefits all
Be Provocable: provide correction for others’ meanness
Keep It Simple: predictability breeds trust
Watching one season of the show Survivor demonstrates the effectiveness of these rules.
Take, for example, this oldie but goody drawn from the hallowed halls of game theory (1950, Merrill Flood and Albert W. Tucker):
Two suspects are arrested. The police have insufficient evidence for a conviction, and, having separated the prisoners, visit each of them to offer the same deal. If one testifies for the prosecution against the other and the other remains silent, the betrayer goes free and the silent accomplice receives the full ten-year sentence. If both remain silent, both prisoners are sentenced to only six months in jail for a minor charge. If each betrays the other, each receives a five-year sentence. Each prisoner must choose to betray the other or to remain silent. Each one is assured that the other would not know about the betrayal before the end of the investigation. How should the prisoners act?
Check the back of this book for the answer—it’s as good as the puzzle itself.
