Reason science writer Ron Bailey examines some recent experiments on human cooperation. His conclusion:

The moral of the story is that if you want to live in a world of caring generous cooperative people, make sure that you thoroughly thrash all the greedy, chiseling scoundrels you come across. It may cost you, but the world will be a better place.

Solveig likes to use "action interest vs constitutional interest"; I tend to say "Prisoner's Dilemma.". But both terms refer to the need for human societies to develop not just rules but informal codes of conduct that recognize people's long-term interest in creating stable systems of cooperation, as opposed to short-term efforts to game the system.

The context, of course, is the current dispute over P2P, and the fact that it presents precisely this kind of conflict between short-term and long-term interest. I am cheered to know that we should keep on trashing the greedy chiseling scoundrels, since we absolutlely intend to do so.

posted by James DeLong @ 9:55 AM | Game Theory , P2P

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The news that this year's Nobel Prize equivalent for economics has gone to a couple of game theorists has triggered some discussion in the business press and the econ blogs over the suggestion that game theory is not a really a science because it does not yield testable predictions, so what good is it? See Marginal Revolution; Knowledge Problem; Daniel Drezner; Business Week; Slate.

Continue reading The Uses of Game Theory . . .

posted by James DeLong @ 8:48 AM | Game Theory

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Prof. Thomas C. Schelling, serial retirer from Harvard and the Univ. of Maryland, shares this year's Bank of Sweden Prize in Economics (sorry - I refuse to use "Economic Sciences") "for having enhanced our understanding of conflict and cooperation through game-theory analysis." (More excerpts from the citation.)

Anyone who has not read The Strategy of Conflict (1960) should drop everything and order a copy. As noted by GMU economist Tyler Cowen:

Before The Strategy of Conflict, game theory was for the most part an abstract desert. It is not easy to find concrete economic propositions in von Neumann and Morgenstern or for that matter in Nash. Tom brought game theory into the real world. The magnitude of this shift is hard to appreciate from the vantage point of today.

[H]as great power for explaining why animal and human societies are organized as they are. It is one of the great ideas of the twentieth century, simple enough for anyone to grasp and of fundamental importance. (p. 9.)

posted by James DeLong @ 8:59 AM | Game Theory

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