Sunday, December 16, 2012

Journal Entry #16: Topic: Game Theory and Chicken



The prisoner’s dilemma is a canonical example of a game analyzed in game theory that shows why two individuals might not cooperate, even if it appears that it is in their best interests to do so. In the game theory, Adamn Smith wants people to act a way that everyone gets benefits but it’s erally hard because everyone wants to act in a way where they can pursue their self interest. Game theory can prevent people from doing the wrong decision as a whole but it’s not possible to be exert into real life situation. Bad outcome is unavoidable of course because people like to like in their self interest, and when someone act in their self interest they cause other to act like them or cause other to act in another way which they won’t get benefit as a group. Bad outcome can be avoidable when people cooperate together. A better outcome occur is when two people doesn’t act in a similar way such as one confess and one doesn’t then both of them will get one year sentence. However it’s impossible because people act in their self interest, and that means that they want to get the least sentences they could and don’t care about what another person gets. It’s really hard to get a good outcome if they don’t cooperate. 

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