Game Theory Essay ⋆ Political Science Essay Examples ⋆ EssayEmpire

Game theory analyzes social situations in which par ties choose actions in pursuit of their individual goals, each person knowing that his or her success depends on all the choices made. A player, X, tries to predict others’ moves and considers their views of the situation. However, X realizes that they are likewise trying to predict X’s move, so a circularity appears. The most important concept in the theory, the equilibrium of John Nash, is an attempt to escape the circle.

The analysis is conducted mathematically, so the details must be specified precisely. In the simplest case, parties know their goals and the consequences of their moves, and they know that the others are similarly informed. In more sophisticated games, the players may be uncertain about goals, moves, or outcomes, and their uncertainty is expressed as probability distributions. The use of mathematics ensures that all assertions have a clear meaning within the formal system and that the conclusions follow undeniably from the premises.

Game theory applications have yielded results that seemed odd at first but made sense when the logic was examined, and without the discipline of mathematics the analyst might have slipped back into the conventional thinking. The theory’s precision does not mean that it can predict real parties’ actions in specific contexts, since it is impossible to model all variables in play or measure all the parameters. The theory’s contribution has been to clarify the structure of different kinds of conflict or coordination.

Game theory proper is distinguished in its applications. It is a mathematical enterprise guided by interest in abstract systems, following criteria that are basically aesthetic. The greatest number of applications are in economics, followed by political science, biology, computer science, law, linguistics, and the philosophy of ethics.

Game Theory In Play

Game theory is different from rational choice theory, which assumes that par ties pursue self-interested goals such as pleasure, resources, or power. Game models sometimes include these kinds of goals, but they often do not. John von Neumann and Oskar Morgenstern, the founders of the field, also initiated modern utility theory to provide a basis for measuring one’s goals even when they are not money or any other quantitative commodity.

A strategy is a complete plan of action for the game, instructing a player what to do for any information that might arise. A Nash equilibrium is an assignment of strategies to the players, such that each player would be ready to use his or her strategy even if, hypothetically, the player learned the others’ strategies. Whether this property should persuade sensible players depends on the situation. In the most favorable case, players’ culture and history might give them shared expectations about each other’s moves, and it follows that they would use a Nash equilibrium.

For a wide class of games, at least one equilibrium exists, but often a game possesses several. The theory’s own logic thus shows it is not deterministic and leaves a role for outside factors like precedent or culture. To increase the theory’s predictive strength and to eliminate certain nonsensible equilibria, writers have constructed requirements to reduce the set of Nash equilibria, for example, subgame perfection, intuitive criterion, and forward induction. They show the importance of beliefs about events that never happen, that is, of players’ expectations about behavior on nonoptimal paths of play. Other work has contended that Nash’s concept is too narrow and tried to generalize it, prominent concepts being rationalizability and correlated equilibria.

Behavioral game theory, a development of the past two decades, tests simple models in the laboratory. Other research has focused on certain elements from the beliefs-goals-strategies triad: Interactive epistemology, for example, studies knowledge about other parties’ knowledge, and the theory of games in coalitional form considers only the values of the coalitions players can join and not the moves they might make to get into them. Evolutionary game theory drops the element of strategic thinking in favor of imitation or heredity, so that a certain rule that does well in one generation of players will be used more often next time.

A prominent application in political science studies the growth of trust and reputation in social institutions. Repeated games, where the same elementary game is played over and over, have a major role. Also fundamental are signaling games, in which an informed player makes a move from which another player draws information as a basis for action.

Game Theory In Application

Game theory has been applied to nuclear weapons strategy, and some scholars have claimed that it set American policy during the 1950s or guided specific decisions. In fact, the nonformal strategy came first and the games later. The theory’s real contribution has been generic knowledge about strategic issues, such as how to make a threat credible, when past resolved behavior provides a reputation that deters future challenges, how to reduce the mutual temptation to launch a preemptive attack in a crisis, whether building weapons sometimes signals resolve rather than increases military strength, what role emotions or lack of control plays in deterrence, and how states should deal with the security dilemma, where weapons built for defensive purposes also add offensive capability and spark building by the adversary. Other research has studied the advantage of democracies in crisis bargaining, the regularity that democracies seldom get into war with each other, the greater difficulty of negotiating an end to a civil war compared with an international one, reciprocity in trade agreements, the effectiveness of economic sanctions, the design of international treaties, the role of honor and face in international affairs, and strategic aspects of terrorist recruiting.

In the analysis of governance systems, strategic questions arise from four viewpoints: that of founders who set up a constitution to achieve stability and fairness; that of candidates trying to get elected; that of voters who vote strategically rather than simply choosing their favorite; and that of legislators who assemble allies and construct clever motions. An early paper from a founder’s perspective was Lloyd Shapley and Martin Shubik’s 1954 proposal on measuring the power of a committee member based solely on the voting rules. Later examples have asked whether any voting methods exist that motivate voters to act sincerely rather than strategically, that is, to choose their most preferred candidate rather than consider, for example, “electability.” (The answer is that the only such methods are bizarre and undesirable.) A literature has developed on how the median voter theorem holds up with strategic voters under various voting systems.

Bibliography:

Aumann, Robert, and Sergiu Hart, eds. Handbook of Game Theory with Economic Applications, vols. 1–3. Amsterdam: North Holland, 1992–2002.
Banks, Jeffrey. Signaling Games in Political Science. New York: Taylor and Francis, 2002.
Osborne, Martin J. An Introduction to Game Theory. New York: Oxford University Press, 2003.
Shapley, L. S., and Martin Shubik. “A Method for Evaluating the Distribution of Power in a Committee System.” American Political Science Review 48 (1954): 787–792.

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