Game Theory

Game Theory is the science behind how people make decisions. It is the interplay of which whether the players would cooperate or to be self-interested. The Game is essentially simple- it is put a various amount of permutations of which who will nudged the player to rat out on a person or to cooperate with a fellow player or "prisoner" to achieve a win-win outcome. Very often, the game is played out assuming perfect information and that all player's decision are rational.

That is the reason game theory is used frequently in economics, politics and many other forms of social sciences- of which is to "predict" the behaviour of fellow human beings as social and rational actors.

Game theory was aptly shown in the movie: " A Beautiful Mind" where, John Nash protagonist started out from the idea whereby how come all the blond girls ultimately are left alone- because all the men where chasing them ironically.

The theory of course have more larger utilities beyond dating but it is the idea that how can achieve a given outcome given a benefit and punishment system. But like all Grand Theory, it has four fatal flaws 1) it is deterministic 2) homogeneity is a given 3) all players have perfect information 4) all players are rational creatures

The problem with all "Grand Theory" is that purports to explain all human behaviour without really clarifying the underlying assumption of which is the above.

1) Determinism is the belief that the theory will follow reality and we believe that the causal relationship is vice versa as well. And if it does, we would have created an utopia on earth- and all knowledge is made redundant.

2) Homogeneity is a given. In the game, all players are rational creatures, but the problem with reality is that what is carrot to some might be punishment to others. And vice versa. Hence therefore given such a scenario, the eventual outcome is an equilibrium of which is not reflective of the values of the players. For rationality to succeed in such circumstance, homogeneity must be a given. Otherwise weights and values are not given place in the carrot and the stick.

3) Perfect Information. This is related to the second. Perfect information refers firstly that all players have equal amount of information of which to decide the best outcome for himself/herself. But if what I viewed as important of which you don't and vice versa- and ultimately both have differing assumptions of each other, the game itself is skewed. Equilibrium can never be reached because both parties are searching for different things. What then ultimately transpired would always be a string of short run unsettled stable points isn't it.

4) All players are rational creatures. This assumption has been attacked by all corners and by every of scientist everywhere. Hence I will not say further but the ultimate payoff is that if we are all rational creatures- why aren't we aren't equally rich in the first place.

Since we are on this topic of Game Theory, I just like to add little more spice into this discussion. Since I have some knowledge of the Game Theory, why aren't am I applying to your personal life in the first place and secondly, and since you are so familiar with the game, I should be excellent at playing it isn't it.

Ultimately then, it must be said, one must look into assumption 2) and 3) for the answers. What is perfect information- and really is that the life you wish to live: and look assumption 4) and in the end we come back to 1), do we really wish to our live in this way.

At the end of the day, all knowledge is tautological and really as they say: "we are wiser when we know that we don't know."

Eugene