This is because the effort they put into refraining today would’ve been wasted. However, if the addict cooperated today and relapsed tomorrow, they would receive the worst outcome. If the addict cooperates in the present and in the future, they would achieve successful rehabilitation. Cooperating is refraining and betraying is relapsing.

Application in PsychologyĪddiction can be modelled as PD problem with the players being ones present and future self. The game provides an iconic game theory strategy: because betraying a player offers a greater reward than cooperating, all rational self-interested prisoners will betray the other, meaning the only possible outcome for two rational prisoners is to betray each other. The picture above shows what would happen to the prisoners depending on their chosen action. The Prisoners could either cooperate by remaining silent, or betray by confessing the crime of the other prisoner. The prosecutor doesn’t have enough evidence to convict either prisoner. This primer will address whether or not game theory is defeated by the complexity of real world situations through examining the Prisoners Dilemma.

Thus, game theory models may not accurately predict behaviour. Real people are more complex than players in games, as there may be many interconnected factors influencing their every decision. This belief is extended to economic institutions.Ĭriticisms of game theory focus on how its methods assume that humans are rational and self-serving. Some game theorists believe that by finding the equilibria of games, they can predict how actual human populations will behave when confronted with situations analogous to the game being studied. Game theory is a method of applied mathematics used to study the decision-making processes of rational beings (humans, animals, computers).

Note: This entry was created in 2018, when the task was to “summarise a key reading”, and so may not represent a good example to model current primer entries on.

Game theory situations in real life