Monday, January 07, 2008

What I learned about the prisoner's dilemma from watching daytime TV


Fast forward to 6.00 to see how the UK TV show Golden Balls implements the prisoner's dilemma in real life. It's the same payout structure used in the US show Friend or Foe, in which two opponents must semi-independently choose to split or steal a jackpot. If they both split, they get half each, if they both try to steal they get nothing, and if one steals while the other splits, they claim the whole amount. At first glance it seems apparent that optimally both players should go for the steal, and that's indeed the option predicted by game theory. However that's not what happens 55% of the time, according to this fantastic paper: Social Learning and Coordination in High-Stakes Games - Evidence from Friend or Foe.

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