1. OPEC Oil Cartel Iraq’s Output 2 4 Iran’s Output 46* / 42** 26* / 44**
46* / 42**
26* / 44**
52* / 22**
32* / 24**
*Daily profit for Iran, **Daily profit for Iraq
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

2. Achieving Cooperation
Detecting Cheating
Punishing Cheating
Punishment is Guaranteed
Crazy Eddy’s Low Price Guarantee
Tit-for-a-tat
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

3. Crazy Eddy vs. Newmark & Lewis
Low Price
High Price
Price Guarantee
Crazy Eddy
50* / 50**
150* / 10**
10* / 150**
75* / 75**
*Profit for Crazy Eddy, **Profit for Newmark& Lewis
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

4. High Definition TV Japanese Effort Low High US Effort 4* / 3**
4* / 3**
2* / 4**
3* / 2**
1* / 1**
*payoff for US, **payoff for Japan
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

5. Commitment And Credibility
High effort
1*,1**
Japan
Low effort
High effort
3*,2** US
High effort
2*,4**
The US may have to commit R&D funds to firms to make this credible.
Low effort
Japan
Low effort
4*,3**
*payoff for US, **payoff for Japan
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

6. Threats and Promises Threats Promises Warnings vs. Assurances
“No dessert unless you eat your spinach…”
Promises
“Pay me now and I won’t hurt you…”
Warnings vs. Assurances
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

7. The Cold War: Nuclear Deterrence
Conventional
1*,-1**
U.S.
Start Land War
Nuclear
-100*,-100**
Soviets
No War
0*,0**
*payoff for USSR, **payoff for US
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

8. Dr. Strangelove U.S. -100*,-100** Soviets 0*,0** Start Land War
Nuclear
-100*,-100**
Soviets
No War
0*,0**
*payoff for USSR, **payoff for US
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

9. The eight-fold path to credibility
Establish a reputation
Write contracts
Cut off communication
Burn bridges behind you
Leave the outcome to chance
Move in small steps
Develop credibility through teamwork
Employ mandated negotiating agents
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

10. Reputation Israel’s refusal to deal with hijackers
Tax amnesty & the US Congress
Mayflower Furniture “127 years without a sale”
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

11. Contracts Agree to penalties if you don’t follow through Complications
Nick Russo: “$25,000 to the charity of your choice if you catch me eating in a restaurant.”
Renegotiation
For a contract to work, the party that enforces the contract must have some independent reason to do so.
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

12. Cutting Off Communication
Death and Cecil Rhodes
Suppose that universities insist on $1.5 million to endow a chair…can endow one for less?
It took an act of parliament to let Rhodes scholarships be given to women because it was in his will.
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

13. Burning Bridges
Cortez burned his own ships upon arrival in Cempoalla, Mexico
Cortez’s soldiers new they could not retreat or desert, and his foes new that they would fight to the death.
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

14. Leaving the Outcome Beyond Your Control
Dr. Strangelove
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

15. Moving in Steps Honor among thieves
Event 1: A single million dollar transaction
Event 2: A thousand transactions of $1000
No double crosses over small amounts…spit into small steps commitment is feasible
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

16. Teamwork Peer Pressure: Weight Watchers, AA
Romans: Falling Behind was a capital offense for soldiers
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.

17. Mandated Negotiating Agents
A labor leader may have to deliver the gains he promised or lose his job
This slideshow was written by Ken Chapman, but is substantially based on concepts from Thinking Strategically by Avinash K. Dixit and Barry J. Nalebuff, W.W. Norton 1991.