Spatio-temporal information in society: game theory Gilberto Câmara Licence: Creative Commons ̶̶̶̶ By Attribution ̶̶̶̶ Non Commercial ̶̶̶̶ Share Alike http://creativecommons.org/licenses/by-nc-sa/2.5/

Game Theory GT is an analytical tool for social sciences that is used to model strategic interactions or conflict situations. Strategic interaction: When actions of a player influence payoffs to other players

Game Theory Explanation: What is the game to be played? Prediction: What outcome will prevail? Advice or prescription: Which strategies are likely to yield good results in which situations?

Where can we use Game Theory? Any situation that requires us to anticipate our rival’s response to our action is a potential context for GT. Economics, Political science, Biology

What is a Normal Form Game? Players: list of players Strategies: all actions available to all players Payoffs: a payoff assigned to every contingency (every possible strategy profile as the outcome of the game) John Kennedy and Nikita Khrushchev

Modeling two-party games Payoffs for each player depend on actions of both Two possible strategies: A party cooperates when he performs value-increasing promises, and defects when he breaches

Modeling choice in non-cooperative games Player 2 Cooperate Defect Both cooperate Player 1 cooperates, Player 2 defects Player 1 defects, Player 2 cooperates Both defect Player 1

The “chicken game” “Rebel without a cause” Two persons drive their cars towards a cliff. They must stop or both may die in the fall. The one that stops first will be called a "chicken," meaning a coward.

The hawk-dove game (== chicken game) Two individuals compete for a resource (In biological terms, its value increases in the Darwinian fitness of the individual who obtains the resource) Hawk Initiate aggressive behaviour, not stopping until injured or until one's opponent backs down. Dove Retreat immediately if one's opponent initiates aggressive behaviour. Maynard Smith and Price, "The logic of animal conflict“ (Nature, 1973 )

The hawk-dove game (== chicken game) Encyclopedia Britannica

The stag-hunt game: conflict between safety and social cooperation Two hunters want to kill a stag. Success is uncertain and, if it comes, require the efforts of both. On the other hand, either hunter can forsake his partner and catch a hare with a good chance of success.

The stag-hunt game: conflict between safety and social cooperation 10,10 0,6 6,0 5,5 Rousseau, in A Discourse on Inequality: “If it was a matter of hunting a deer, everyone well realized that he must remain faithful to his post; but if a hare happened to pass within reach of one of them, we cannot doubt that he would have gone off in pursuit of it without scruple..."

Prisoners’ Dilemma Two suspects are caught and put in different rooms (no communication). They are offered the following deal: If both of you confess, you will both get 3 years in prison If you confesses whereas the other does not, you will get 1 year and the other gets 5 years in prison . If neither of you confess, you both will get 2 years in prison.

Generalizing... D C b – c -c b Payoff matrix Cooperation requires at least two individuals: A: the one providing cooperation (DONOR) B: the one benefiting from cooperation (RECEIVER) Donor has a cost c to cooperate and confers a benefit b to other player D C b – c -c b To efficiently study several social tension we can start from the benefit cost dilemma presented in the beginning. If we consider that each player plays simulataneously as a donor and receptor we reach to the following payoff matrix. We have 4 parameters for each situation. The reward for mutual cooperation, the punishment for mutual defection, the sucker’s payoff (when an individual is cheated and finally, the payoff received by a defector interacting with a cooperator. you Payoff matrix other

Terminology Player 2 T = Temptation to defect R = Reward for mutual cooperation P = Punishment for mutual defection S = Sucker's payoff

Generalizing... Payoff matrix D C R(1) S(-c) P(0) T(b) R: mutual cooperation P: mutual defection S : sucker’s payoff T : temptation to defect other D C R(1) S(-c) P(0) T(b) To efficiently study several social tension we can start from the benefit cost dilemma presented in the beginning. If we consider that each player plays simulataneously as a donor and receptor we reach to the following payoff matrix. We have 4 parameters for each situation. The reward for mutual cooperation, the punishment for mutual defection, the sucker’s payoff (when an individual is cheated and finally, the payoff received by a defector interacting with a cooperator. you Taking R = 1 and P = 0

Generalizing... Payoff matrix D C 1 S T R: mutual cooperation P: mutual defection S : sucker’s payoff T : temptation to defect opponent D C 1 S T To efficiently study several social tension we can start from the benefit cost dilemma presented in the beginning. If we consider that each player plays simulataneously as a donor and receptor we reach to the following payoff matrix. We have 4 parameters for each situation. The reward for mutual cooperation, the punishment for mutual defection, the sucker’s payoff (when an individual is cheated and finally, the payoff received by a defector interacting with a cooperator. you Taking R = 1 and P = 0

Different ordering -> Different tensions greed fear Chicken game Stag-hunt game Prisoner’s dilemma T > 1 > S > 0 S P D C R T 1 > T > 0 > S T > 1 > 0 > S So, we can obtain the chicken game or hawk-dove game proposed by Maynard-smith; the stag-hunt game proposed recently by brian skyrms and the famous prisoner’s dilemma. Note, the rational choices change dependenging on the game: Contrary to the PD, in the SG is always better to choose a strategy which is opposite from your opponente while in the SH you should mimic your opponent (that’s why is also called a coordination game). From this, different tension raises. in the SG, people defect because the gains received by deceiving someone are huge. Agents defect because they are greedy to receive the benefits. In the SH game agents defect because they are afraid of being cheated. Unilateral cooperation is the worst case possible. The PD mixes the 2 tensions. ll this dilemmas represent a certain tension. When Temptation is big than individuals cooperate because they are greedy to receive high benefits without providing any help. In the stag-hunt game the opposite happens. People defect because they are afraid of being cheated. The sucker’s payoff is a quite bad outcome. The prisoner’s dilemma merges these 2 tensions being the worst regime for the emergence of cooperation. (Macy&Flache, PNAS 2002)

Tragedy of the Commons (Hardin, 1968) Assume a common-property resource (exclusion is difficult and joint use involves subtractability) with no property rights. (Pasture open to all) Each herdsman tries to keep as many sheep as possible on the commons. Each tries to maximize gain.

Add those sheep! The rational herdsman concludes that he should add another sheep. And another…And another…And so does each herdsman “Ruin is the destination toward which all men rush, each pursuing his own best interest…”

Prisioner´s Dillema as a Model for the Tragedy of the Commons Suppose the commons can support 2 sheep at no cost and that each additional sheep put in the commons has a cost of 1/3 of its price due to overgrazing. Assume two herdsman with one sheep on the commons each. If a herdsman puts another sheep in the commons, he receives all the proceeds from the sale of each additional animal. His temptation is 4/3 and the sucker´s payoff for the other herdsman is -1/3.

Prisioner´s Dillema as a Model for the Tragedy of the Commons You are the herdsman. What are your options? Do you cooperate or defect? D C 1 -1/3 1/3 4/3 To efficiently study several social tension we can start from the benefit cost dilemma presented in the beginning. If we consider that each player plays simulataneously as a donor and receptor we reach to the following payoff matrix. We have 4 parameters for each situation. The reward for mutual cooperation, the punishment for mutual defection, the sucker’s payoff (when an individual is cheated and finally, the payoff received by a defector interacting with a cooperator. you Payoff matrix other

Everybody’s property is nobody’s property (Hardin) Tragedy of the Commons? Everybody’s property is nobody’s property (Hardin)

Preconditions for the tragedy of the commons Lack of restraint on pursuits of self-interest Consequences are externalities (I don’t have to pay)