Prisoner’s dilemma is a problem commonly featured in game theory. Each player is given an option to be either nice or nasty. Each combination of player plays multiple number of rounds. When tested against different strategies, it is found that the best performing strategies are :
- nice first ( they don’t start the provoking),
- retaliatory (when opponent is nasty they also resond nasty),
- forgiving (they don’t hold grudges),
- clear (their strategies are clear for opponent to interpret) and
- generous (when the opponent has been nasty, they do not retaliate 10℅ of the time )
It explains why the most selfish people often lack foresight and are not smart outside of a very narrow focus.
How does this explain that the world is essentially ruled by ruthless billionnaires? The strategies referenced may be vindicated, but that doesn’t preclude them from being eclipsed by another, even greater strategy, that of total domination.
Or is anyone going to tell me straight-faced that all those people are great examples of our species and should be revered? None of them got where they are by playing nice.
Take away the power to tit for your tats, and now you can be almost as nasty as you want.
The prisoner’s dilemma is of course, a highly simplified model. If you could just submit a strategy like “my opponent doesn’t get to play, so I take all the points” then yeah, that would beat tit for tat.
This isn’t really about the current global economic situation, more about like human behaviour.
In the prisoner’s dilemma, aggressive options tend to do well only in the short term, so you could see ruthless billionaires as short-sighted, considering their reaping of the earth will end up destroying the ecosystems we live in.
Only works when there is a genuine risk of retaliation equal or worse than the damage done, i.e.:
- There are multiple rounds or each round is done is such a way that the second person has a real choice, or in other words people can’t just make a one-sided choice, cash their gains and dissapear but instead face consequences immediatelly or on subsequent rounds.
- Both sides have similar power to inflict hurt on the other side.
In fact various experiments from Behavioural Economics similar to these and done with conditions more like I describe show exactly that effect: far fewer behave nicelly and are generous and forgiving when others can’t meaningfully retaliate.
It’s not by chance that most situations in real life of somebody taking advantage of somebody else either involve a context where the abuser can just extract a gain and dissapear, escaping retaliation, or there is a massive power imballance so the victim can’t actually retaliate in any meaningfull way (say, the “boss” vs an employee that can easilly be fired or an elected politician making choices that hurt a minority of electors).