As we are learning with the War in Ukraine, understanding Game Theory is important if we want to understand why war breaks out, how long and how deadly a war will be, and how a war will come to a conclusion. Game Theory helps us think about the decision-making of the parties involved in a war and the incentives and risks that they face. Television pundits, journalists, politicians, and policy analysts are all engaging in game-theoretic evaluations of the current conflict in Ukraine to help think about a way that Russia could leave Ukraine without completely destroying the country and its population.
While much of the world has recently been thinking about Game Theory in the context of two large warring nations, the most basic way to think about and understand game theory is usually a two person situation known as the prisoner’s dilemma. Conceptualizing Game Theory in this basic format gives us a framework that we can use to understand larger conflicts and dilemmas where parties have to make decisions anticipating the outcomes of their choices, the responses and choices of their opponents, and the subsequent reactions and decisions of everyone else along the way. The simple framework from a two person prisoner’s dilemma scales well.
In his book The Better Angels of Our Nature, Steven Pinker writes about Game Theory and how size doesn’t seem to matter when we think in a game-theoretic way. He writes:
“The same psychological or game-theoretic dynamics that govern whether quarreling coalitions will threaten, back down, bluff, engage, escalate, fight on, or surrender apply whether the coalitions are street gangs, militias, or armies of great powers. Presumably this is because humans are social animals who aggregate into coalitions, which amalgamate into larger coalitions, and so on.”
Our coalitions are large and complex, but they are still organized around humans. Our social nature is predictable, meaning that Game Theory can apply in any human coalition, regardless of size. Quite often our large coalitions, especially coalitions that employ violence, are ultimately lead by a single individual who can command the decisions to use violence. This all contributes to Game Theory’s application across two people interactions, high school gangs, or armies comprising hundreds of thousands of soldiers. Game Theory helps us understand the decision-making of all the groups, regardless of their complexity and size.