Deck 14: Game Theory and Mutual Interdependence

Question 1

Why does game theory provide a useful framework for studying individual behavior during pandemics? What are some examples?

Answer 1

During a pandemic, individuals face a series of strategic decisions in unfamiliar situations, including sheltering-in-place and social distancing. Because game theory, the study of strategic choice, addresses individual decision-making and social outcomes, it offers a method to analyze human behavior during a pandemic. We may view individuals as participating in a game of strategic interaction. In the game, members of a target population serve as players, and payoffs exist. Policymakers attempt to minimize the spread of the disease. The disease attempts to maximize infections. Individuals attempt to minimize the risk of infection while maintaining economic opportunity.

Question 2

In a game theory framework, discuss the importance of rules, strategies, and payoffs.

Answer 2

In game theory, three elements must exist in order for a game to take place. These three components are rules, strategies, and payoffs. Rules are the instructions that dictate choice and outcomes. Strategies are options for players in which the outcome depends on both the player's choice and the choices made by other players. Payoffs are values assigned to possible outcomes of a game, including monetary, social and psychological values (one common category of these is rewards). Without rules in a game, it is prohibitively unclear how the game is to function. If strategies for playing the game are disregarded, the game would likely succumb to chaos, and no productive outcome would be realized. Finally, without some payoff, a rational actor would not participate.

Question 3

In a game of survival, how may we view the payoffs of individuals, policymakers, and the disease? What are the costs and benefits of cooperation?

Answer 3

At the end of any game of survival exist the dichotomous realities of life or death. Operating under the assumption that the ultimate reward is continuation of life, while the ultimate loss is interruption of the same, we may view the payoffs of individuals, policymakers, and the disease fairly simply. This disease has the power to kill - all other elements are largely secondary. As game theory analyzes the choice of the individual for his own benefit versus his choices for the benefit of the group, we are able to pretty closely observe the costs and benefits of cooperation. If it wasn't all along, it has become abundantly and increasingly clear that one of the most effective methods for pandemic mitigation rest(ed) in society-wide cooperation toward stemming the spread of the virus. Interestingly, as may be common, the complicating element of politics compelled some individuals to disregard scientific and empirical data in lieu of political leanings. To even contemplate this reality is, at best, vexing, let alone watching as certain demographics reveled in their own recalcitrance. Again, as we have clearly seen - the benefits of cooperation include aggressive reduction of the virus' reproduction rate, while the costs invariably spell abjectly unnecessary illness, to corporeal demise.

Question 4

How do strategic form games differ from extensive form games?

Question 5

With respect to equilibria, how does the prisoner's dilemma differ from the stag hunt game?

Question 6

Why do experiments provide a useful method of empirical investigation for game theory problems? What different types of experiments exist?

Question 7

Explain the bargaining game in this chapter. What are the rules, strategies, and payoffs? What are the outcomes? With respect to pandemics, what lessons result from the game?

Question 8

Explain the donor-recipient game in this chapter. What are the rules, strategies, and payoffs? What are the outcomes? With respect to pandemics, what lessons result from the game?

Question 9

Explain the public good game in this chapter. What are the rules, strategies, and payoffs? What are the outcomes? With respect to pandemics, what lessons result from the game?

Question 10

Explain the game of risk perception and strategic choice in this chapter. What are the rules, strategies, and payoffs? What are the outcomes? With respect to pandemics, what lessons result from the game?