14.7.09

PRECISION MATTERS. Len Fisher's Rock, Paper, Scissors: Game Theory in Everyday Life offers easy reading and a humorous presentation of the elements of game theory as applied to social interactions. It would offer an accessible introduction to the subject but for a cavalier disregard for the finer points of modeling, which will mean some readers will have a misunderstanding they will have to unlearn should they ever study game theory in a serious way. Thus Book Review No. 20 is less-than-favorable, as it would have been easy enough to illustrate the essential dilemmas of human interaction without abusing the careful modeling that each of those dilemmas has inspired.

I'm frustrated by his attempt to distinguish Tragedy of the Commons from Free Riding from Prisoners' Dilemma in an otherwise useful presentation that makes the case that many human interactions can be described as Prisoners' Dilemma or as Chicken or as Altruists' Dilemma or Battle of the Sexes or as Stag Hunt. Simply consider all the orderings of payoffs in a 2x2 game, with or without dominance solvability, and elaborate as required. But you'll scan Rock, Paper, Scissors in vain for any mention of dominance solvability (it's not that challenging an idea) and your reading of what the author calls a Nash Trap (a recurrent theme in the book: in economics we'd call it coordination failure) will not give you an understanding of two key results in game theory, namely Dominance Solvability Implies but Is Not Implied by Nash, and Nash Sometimes Converges to Pareto Efficient. These ideas, while not central to the author's message, would help clarify when mutually-beneficial cooperation is likely to emerge in human interactions, and when it is not. It's that emergence that is the central message.

(Cross-posted to 50 Book Challenge.)

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