A British gameshow called “Golden Balls” invites contestants to play a version of the Prisoner’s Dilemma, wherein the two contestants have to decide whether they’re going to “split” or “steal” a pot of money.
If they both opt to split, they split the money.
If one opts to split, and one opts to steal, the one who steals it gets the whole pot.
And if they both steal, then neither get the money.
One player comes up with an interesting strategy…
The coolest application of game theory is that scene in Dark Knight in which they have to decide to bomb the other boat or risk dying first.
Even though it makes for good reality shows and movie arguments, I don’t think game theory deserved a Nobel price…
But game theory has far reaching applications in corporate governance, consumer behavior, or social policy. If 110 Nobel Prizes in economics have been awarded so far, I don’t see why at least one should not be dedicated to decision making studies.
It is not like people didn’t know how to find the equilibrium of a non-cooperative game before someone put a name on the phenomenon.
That’s a dumb argument. The same can be said for gravity then. After all, every living thing was feeling it before a “name” was put on it, and then people started to examine it more closely. Should people have just laughed at Newton and called him an idiot?
I disagree. This principle has been used in countless bars across the world ever since, helping men everywhere get laid. That is truly worthy of a Nobel.
He’s still alive. My wife sees him walking across campus a few times per year.
Game theory is extremely useful. I think most people would be better off taking a class in game theory than macro ecnomics.
Game theory is pretty widely used not only in Dark Knight but also in Evolutionary biology and Political science, as bchad will tell us. I bet it’s also used in the NFL draft.
Dark Knight was not strictly a prisoners dilema. It was a sequentail move, so if Criminal 1 would chose to rat, the other would automatically not rat. If boat 1 would chose to blow up another boat, boat 1 would survive, so, strictly speaking it was not a prisoners dilema
It was not a PD, but it was a game…
Hmm. I thought I posted something here… maybe I didn’t press send.
Or maybe if I pressed send, and the other guy didn’t press send, it was a big waste…
Ah, heck, I’ll press send.
You sure about that? Try explaining the PD to an audience of undergraduates without getting mixed up or mixing them up.
Then explain why in a repeated game, the results can be completely different, and what strategy is optimal in a repeated game system.
Then explain why it all falls apart if the game ends at some known point. What if it ends but at an unknown point.
Then try to decide what game you are actually playing.
After that, then there is cooperative game theory to go through… …oh, and the Colonel Blotto game… or the games in which the optimal strategy is to randomize your decision so the opposing party can’t predict what you are going to do.
Game theory is more than just resolving the PD problem, even if that’s the most famous one. It’s just a set of tools for analyzing strategic situations. Yes, other people have analyzed some of them before, but not in the same systematic way. It’s a bit like saying that people knew about velocity before calculus, so what’s the big deal about derivatives (though I’ll concede that calculus has many more applications in general than game theory).
And to correct the record, the guys who won the prizes in 1996, 2001, 2002, 2005, 2007 were also all influenced strongly by game theory. So it’s not like that was the only nobel for game theory contributions.