Monday, November 3, 2008

Ok, ok, it's serious, but it is still *like* a game

The whole point of abstracting a set of objects into a single object is both to simplify the model of the dynamics and to reflect a dynamic that the action of individual units cannot explain. This is the most apparent in strategic situations with humans. Many species of animals and especially humans rally behind a leader. Humans have a theory of mind and human leaders will try to predict how other leaders are going to react to get the best outcome either for themselves or their group - much like any strategic board game. Often the strategies involve sacrificing some of your own, complete misrepresentations, and outright slaughter. Game theory is still the best representation of the motivations and dynamics - The point is not to trivialise the situation, but to objectively analyse it. The leaders themselves may or may not be consciously thinking about the game-like nature of the strategies, but it neither increases or decreases the risks of the situation. The risk of the situation is a function of the dynamics and boundaries - the rules of the game if you will.

Game theory has plenty of analogues in nature as well - Whether you are talking about a group of vultures vying for the same carcass, or a territorial battle between packs of dogs, game theory brings useful models to the table.

In politics, the game of "brinksmanship" is quite common for tyrants under pressure from sanctions and various threats. The Israel-Palestine stalemate can be seen to be a Nash Equilibrium, as could have been the Cold War.

6) Game theory - If one is looking at a strategic context, and there are few enough units to contend with (or if the units can be grouped thus), Marconomics views Classical game theory as the correct modelling approach. "Dillemma's" are a state of play where there is uncertainty to a decision due to a lack of information of and/or dependence on decisions made by other units: in which case any decision carries irreducible risks and/or rewards either way. In a "Tragedy" scenario, a conflict exists between optimal strategies for the individual unit, and what would be optimal for the whole group if it was considered a unit in itself.

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