Game Theory and Politics
Bruce Bueno de Mesquita has been working for roughly 30 years (about half of his life, as he is now 62 years old) on perfecting an all-in-one super-simulating computer program that can solve nearly any relevant application of game theory – or creating a model “that predicts the outcome of any situation in which parties can be described as trying to persuade or coerce one another.” Mesquita now uses his program to produce predictions for the CIA as well as custom code a situation which aims to predict the extent to which Iran would develop nuclear weapons. The conclusion of the study stated that Iran was likely to research a nuclear bomb but then get to the point of development and cease operations.
This article discusses a few of the other ways that Mesquita uses game theory to make predictions and do analysis. The article even goes on to discuss some of the key elements of game theory such that it is a study of how people will behave based on other people’s decisions. This includes the discussion of the assumption in game theory that the opponent player is a ‘rational’, selfish being that will do whatever is best for him first. For example, if an opponent had a dominant strategy, under this assumption, then you would choose the strategy that gives the most utility given that the dominant strategy is played. The article also discusses how Mesquita decides when he has reached a solution throughout these simulations. Once the movement of players between different strategies does not vacillate over different preferences in the initial simulation settings then it is concluded that the players in the ‘game’ have compromised as much as they will and have no incentive to deviate from their strategy. This point will be the Nash equilibrium, when neither player has an incentive to deviate from the strategy they are using. An interesting and humorous note of the article was how Mesquita even used game theory to negotiate his wage contracts for his consulting services based on data gathered from interviews with the firm’s executives.
http://www.nytimes.com/2009/08/16/magazine/16Bruce-t.html?_r=1&pagewanted=all
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