Economic Wisdom to Apply in Your Twenties

Chapter 62

Chapter 8, Section 2 The so-called fate is actually the result of the game

People who have watched the movie "A Beautiful Mind" may still have an impression of such a plot:
In a university bar, 4 boys were discussing how to pursue a beautiful girl, but a boy next to him was muttering to himself: "If all 4 of them go after that pretty girl, then she will definitely put on airs. No one. Then go after other girls, no one will accept it, because no one wants to be 'shoddy'. But if they go after other girls first, then the beautiful girls will feel isolated, and then It would be much easier to chase her."

"A Beautiful Mind" is a biopic based on the life of Nash, a master of game theory.In the eyes of the boy in the movie, the pursuit of girls is just borrowing Nash's "game theory" perspective, and regards love as a "game".

According to the definition in the "Game Bible", game theory is that two people use each other's strategy to change their own confrontation strategy in an equal game to achieve the meaning of winning.Game theory is also called game theory (Game Theory), which is actually game theory, sports theory or competition theory.

From an economic point of view, a love and a marriage are essentially a game and a competition. In this game and competition, both men and women want to "conquer" or "defeat" each other.When a spark of love arises between a man and a woman, the game between a man and a woman begins.

The stage where men and women pursue each other is the classic model of game theory "Prisoner's Dilemma".If the two parties fall in love at first sight and love each other, but due to the asymmetry of information between the two parties, they only know that they like each other, but it is difficult to judge whether the other party really likes themselves, so in this case, neither party will confess.

The reason for this situation is that both parties will have the following considerations at this time: First, if you confess and the other party is not interested in you, your face will be dull, especially women tend to think so; If you are interested in yourself, you don't want to confess first, because the party who confesses first will often be more passive in the future emotional life.In this way, both parties fell into the prisoner's dilemma and were unwilling to confess their love first, and as a result missed a beautiful marriage.

In another situation, if the boy falls in love with the girl first, and the boy takes the initiative to attack, the information between the two parties is still asymmetric.Because when a boy chases a girl, he doesn't know the girl's psychological state (whether the girl's avoidance is reserved and shy, or refuses), and the girl doesn't know the boy's true thoughts (whether he really loves himself, or has other plans).It is precisely because of the information asymmetry between the two parties that one party is chasing vigorously while the other is hiding vigorously, so both parties are still in the prisoner's dilemma.

Even though both men and women have successfully established a romantic relationship with "the man is affectionate and the sister is interested", the emotional game is still not over.Because lovers in the prisoner's dilemma do not have enough information about each other, they often become suspicious of each other because of love and have suspicions about each other.In order to test each other, the two may talk and act in reverse. The result is that both parties are playing charades, guessing wildly, and suffering.Or for those who can't bear it, a marriage will run aground.

We often use "fate" to explain the fact that two people fall in love or break up.Fate is an abstract concept, which refers to an invisible connection between people, and is an inevitable opportunity and possibility of meeting.From an economic point of view, the so-called fate is just that the two parties can get good communication during the game, so as to get out of the prisoner's dilemma and reach an equilibrium.

Therefore, economists believe that if you want lovers to get married, the best way is for one party to take the initiative to confess. If the other party responds positively, the two parties can enter the state of love smoothly; if the other party politely refuses, then the game will be over. ; If neither of them wants to speak, it is okay if there is an intermediary to communicate.But no matter which way, the key is to let the real information of both men and women be presented.Only when the two parties in love have good communication and realize the information of both parties is the only magic weapon for both parties to get out of the prisoner's dilemma and obtain sweet love.

Wisdom Pieces: The Classic Prisoner's Dilemma
The police arrested two suspects, A and B, but there was not enough evidence to charge them.So, the police imprisoned the suspects separately, met with the two separately, and offered both the following identical options:

1. If one person pleads guilty (betrayal) and the other party remains silent, the person will be released, and the silent person will be sentenced to 10 years in prison.

2. If both remain silent (cooperate), both will be sentenced to half a year in prison.

3. If both report on each other (betray each other), they will also be sentenced to 2 years in prison.

It is summarized in a table as follows:
A silence (cooperation) A confession (betrayal)

B is silent (cooperating) The two are serving half a year in prison. A is released immediately; B is serving 10 years in prison

B pleaded guilty (betrayal) and A served 10 years in prison; B was immediately released and both served 2 years in prison

Which strategy should the prisoner choose in order to minimize his own personal sentence?Due to the isolation and confinement, the two prisoners do not know the other's choice; and even if they can talk, they may not be able to trust that the other will not talk back.As far as the individual's rational choice is concerned, the sentence for reporting the betrayal of the other party is always lower than that for silence.Try to imagine how two rational prisoners would choose in a dilemma:

1. If the other party is silent, I will be released if I betray, so I will choose to betray.
2. If the other party accuses me of betrayal, I have to accuse the other party in order to get a lower sentence, so I will also choose to betray.
The two are facing the same situation, so their rational thinking will come to the same conclusion - to choose betrayal.Betrayal is the dominant strategy of the two strategies.Therefore, the only possible Nash equilibrium in this game is that both players betray each other, and both players serve the same 2 years in prison.

(End of this chapter)