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Grasping Reality with at Least Three Hands 2018-10-06 17:19:38

Summary:
The first write-up of the Prisoner's (or is it Prisoners'?) Dilemma: Merrill Flood (1958): Some Experimental Games: "Summary: Two players non-cooperatively choose rows and columns of their payoff matrices in a series of 100 plays of a non-constant sum game. The purpose of this experimental game is to determine which of several theories best describes their behavior. The players, being familiar with zero-sum game theory, happen to choose a poor solution for their non-constant-sum game... ...The experiment suggests the hypothesis that people tend to start near an equilibrium point and then try to find a better equilibrium if there is one. At the end of the series of plays the players appear to be converging to a cooperative split-the-difference principle, or a cooperatiive von

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The first write-up of the Prisoner's (or is it Prisoners'?) Dilemma: Merrill Flood (1958): Some Experimental Games: "Summary: Two players non-cooperatively choose rows and columns of their payoff matrices in a series of 100 plays of a non-constant sum game. The purpose of this experimental game is to determine which of several theories best describes their behavior. The players, being familiar with zero-sum game theory, happen to choose a poor solution for their non-constant-sum game...

...The experiment suggests the hypothesis that people tend to start near an equilibrium point and then try to find a better equilibrium if there is one. At the end of the series of plays the players appear to be converging to a cooperative split-the-difference principle, or a cooperatiive von Neumann-Morgenstern solution, in this formally non-cooperative game. The social relationship between players appears to be an important factor. (January 1950)

There are now several theories for various special classes of games, some of which are not formally games in the von Neumann-Morgenstern sense. One theory that is of interest is that of Nash for games in which coalitions are prohibited, called non-cooperative games. One brief experiment was conducted with a two-person positive-sum non-cooperative game in order to find whether or not the subjects tended to behave as they should if the Nash theory were applicable,9 or if their behavior tended more toward the von Neumann-Morgenstern solution, the split-the-difference principle, or some other yet-to-be-discovered principle.

The two subjects AA and JW were familiar with two-person zero-sum game theory. They also knew something of the von Neumann-Morgenstern theory for non-constant sum games, but were not familiar either with the work by Nash or with the split-the-difference principle. It was originally intended that non-cooperation be enforced by keeping each subject in ignorance about the identity of his opponent, but this was not done, due to an accident at the outset; the experiment certainly seemed to be fully non-cooperative since there was no evidence of side payments, but there may well have been some implicit collusion within the rules of the game...


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#gametheory
#prisonersdilemmaorprisonersdilemma
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http://www.bradford-delong.com/2018/10/the-first-write-up-of-the-prisoners-or-is-it-prisoners-dilemma.html

Bradford DeLong
J. Bradford DeLong is Professor of Economics at the University of California at Berkeley and a research associate at the National Bureau of Economic Research. He was Deputy Assistant US Treasury Secretary during the Clinton Administration, where he was heavily involved in budget and trade negotiations. His role in designing the bailout of Mexico during the 1994 peso crisis placed him at the forefront of Latin America’s transformation into a region of open economies, and cemented his stature as a leading voice in economic-policy debates.

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