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Prisoner’s dilemma: Difference between revisions
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{{a|glossary|}}{{a|risk|}}{{risk|Trust}}ing is a risky strategy. Generally one side doesn’t survive. How can {{risk|trust}} survive? | {{a|glossary|}}{{a|risk|}}{{risk|Trust}}ing is a risky strategy. Generally one side doesn’t survive. How can {{risk|trust}} survive? | ||
The [[prisoner’s dilemma]] is the mathematician’s way of articulating the [[commercial imperative]]. | |||
An exercise in calculating economic outcomes by means of {{tag|metaphor}}, the [[prisoner’s dilemma]] was developed at the RAND corporation in the 1950s by those splendid brainboxes as a way of predicting individuals’ behaviour in situations requiring [[I believe|trust]] among strangers - for very good example, when unacquainted participants buy or sell in an unregulated market. This field developed into [[game theory]]. | An exercise in calculating economic outcomes by means of {{tag|metaphor}}, the [[prisoner’s dilemma]] was developed at the RAND corporation in the 1950s by those splendid brainboxes as a way of predicting individuals’ behaviour in situations requiring [[I believe|trust]] among strangers - for very good example, when unacquainted participants buy or sell in an unregulated market. This field developed into [[game theory]]. | ||
===The original dilemma=== | ===The original [[prisoner’s dilemma]]=== | ||
Two people are charged with a conspiracy<ref>Whether or not they are guilty is beside the point. If it helps you empathise with their predicament, assume they’re innocent</ref>. Each is held separately. They cannot communicate. There is enough evidence to convict both on a lesser charge, but not the main charge. Each prisoner is separately offered the same plea bargain. The offer is: | Two people are charged with a conspiracy<ref>Whether or not they are guilty is beside the point. If it helps you empathise with their predicament, assume they’re innocent</ref>. Each is held separately. They cannot communicate. There is enough evidence to convict both on a lesser charge, but not the main charge. Each prisoner is separately offered the same plea bargain. The offer is: | ||
{{prisonersdilemmatable}}*If A informs B but B refuses to inform on A: | {{prisonersdilemmatable}}*If A informs B but B refuses to inform on A: | ||
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Now, as well as the short-term payoff, there is a longer-term payoff, and it ''dwarfs'' the short term payoff. If I defect once, I earn £150. If I cooperate a thousand times, I earn £50,000. If I defect first time round, sure: I am £100 up, but at what cost: if my counterparty refuses to play with me again — and if she tells other players in the market — I will struggle to make much money. ''No one will trust me''. | Now, as well as the short-term payoff, there is a longer-term payoff, and it ''dwarfs'' the short term payoff. If I defect once, I earn £150. If I cooperate a thousand times, I earn £50,000. If I defect first time round, sure: I am £100 up, but at what cost: if my counterparty refuses to play with me again — and if she tells other players in the market — I will struggle to make much money. ''No one will trust me''. | ||
===One prisoner, or two=== | |||
In our view, one correctly places the apostrophe to designate a ''single'' prisoner having the dilemma — so [[prisoner’s dilemma]], not ''prisoners’'' dilemma — because both prisoners if taken together ''have'' no dilemma: it is only where they are acting individually that they have a problem ... ''with each other''. | |||
{{sa}} | {{sa}} | ||
*[[Agency problem]] | *[[Agency problem]] | ||