Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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Transcript of Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
http://slidepdf.com/reader/full/final-team-gary-becker-fm2-free-topic-ppt-game-theory-in-movies 1/14
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
http://slidepdf.com/reader/full/final-team-gary-becker-fm2-free-topic-ppt-game-theory-in-movies 2/14
The Joker gives both ferries 30 minutes in which they can detonate
the other side.
Even with this complication, the outcome should be the same and
both actors ought to choose detonation at the first node (t =1 or
when the first move is available).
Using backward deduction, both players recognize that their
opponent will choose to detonate in the final iteration.
What happened in the movie can probably be explained by the
concepts of Survival and Morality
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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DOES MORALITY MATTER?
Perhaps social norms mattered for the actors in the game?
There are some social benefits from being a moral agent.
However, being moral is not as beneficial as being alive.
The pure strategy equilibria are {cooperate-detonate} and {detonate-cooperate}
with a Mixed Nash Equilibrium of playing cooperation and detonation with a
probability of .5 for both players with this specification.
If Survival < Morality then { cooperate, cooperate} is the dominant strategy
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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IRRATIONALITY IS GOOD
The decision making process for both ships is different
Prisoners Law Abiding Citizens
• Decision to detonate becomes
decentralized as time goes by and any
one actor willing to grab the detonator
could do so.
•
Eventually one prisoner takes thedetonator and throws it out.
• A simple majority vote
• The decision to detonate the other ferry
is chosen
• They voted to kill the prisoners but no
one is willing to carry-out-the-task.
•
Civilians are rational but don’t want tocarry out a morally reprehensible task
Since, detonating was the dominant strategy, Joker did not expect the two
ships to cooperate.
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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THE COLD W AR TIMES
US of A USSR
Both countries used to have bombers constantly in the air, already
well on their way to their targets.
You either launch first or convince the enemy that you can strikeback even if you're dead.
The Nuclear war between the two during that timeturned into a Chicken Game
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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G AME THEORY DURING COLD W AR
Game theory's developmentaccelerated at a record pace
during World War II
Though it was intended foreconomics, both the US andthe USSR quickly saw its
value for forming warstrategies.
Game theorist ThomasSchelling convincedofficials that nuclear
weapons were only usefulas deterrents.
Mutual Assured
Destruction (MAD):neither nation could gain
advantage through nuclearattack -- the reprisals would
be too devastating
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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Deterrence is the art of producing in the mind of the enemy... the
fear to attack
The US PLAN R
Plan R is an emergency war plan in which
a lower echelon commander may order
nuclear retaliation after a sneak attack if
the normal chain of command is
disrupted.The plan of Plan R is to make
deterrence more credible by thethreat of losing central control.
Loss of control is exacerbated by the
intentional inability to communicate with
the planes while in the air.
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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The doomsday machine gets triggeredautomatically and all life on the planet is
destroyed
How is it possiblefor this thing to be
triggeredautomatically, andat the same time
impossible tountrigger
Akin to a driverremoving the
steering wheel of a
car
Ruling out "humanmeddling" is crucialbecause one must
make the incredible
threat of suicidecredible
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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Seemingly the ultimate deterrent, thereis one flaw in its deterrence capability:
the Americans don't know it exists
BRINKMANSHIP
Apparently, doomsday machine are easy tobuild. So everyone would end up building it. Andeven a small mistake would lead to disaster.
Turgidson: "I admit the human elementseems to have failed us here. But the ideawas to discourage the Russkies”
The Doomsday machine goes off and theentire Planet is destroyed
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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OLIGOPOLY AND COLLUSIVENESS- GAME THEORY
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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TUCKER: THE MAN AND HIS DREAM- OLIGOPOLY AND COLLUSION
TUCKER CONSTRUCTS ‘THE CAR OF TOMMOROW’ WITH GROUND BREAKING
FEATURES PITTED AGAINST THREE OPPRESIVE DETROIT BASED CAR MANUFACTURERS
THE ENTRY OF TUCKER SEDANS INTO MARKET MAY BE MARRED BY COLLUSIVE
BEHAVIOR OF THE THREE INCUMBENTS EXPECTED TO PROTECT THEIR MARKET SHARE
TO PROTECT THEIR MARKET SHARE, THE INCUMBENTS THROUGH THEIR STRONG
LOBBYING EFFORTS MAY FORCE ALLEGATIONS OF FRAUD AGAINST TUCKER
HOW WILL THE INCUMBENTS STRATEGIZE TO KEEP TUCKER OFF THE MARKET?
8/2/2019 Final Team Gary Becker, FM2, Free Topic PPT; Game Theory in Movies
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TUCKER: THE MAN AND HIS DREAM- OLIGOPOLY AND COLLUSION
THE INCUMBENTS
ALLEGATION NO ALLEGATION
TUCKER ENTER (-2, 10) (12, 2)
DO NOT ENTER (-2, 10) (0, 10)
TUCKER
ENTERS
DOES NOT ENTER
INCUMBENT
ALLEGATION
NO ALLEGATION
STRATEGIC FORM NASH EQUILIBRIUM:
EXTENSIVE FORM:
(0, 10)
(-2, 10)
(12, 2)
CREDIBLE THREAT AS PER SUB GAME PERFECTION: TUCKER WON’T ENTER MARKET