Skip to main content



The Game of Ukraine

https://www.bloomberg.com/view/articles/2015-05-12/gaming-the-ukraine-crisis

 

The crisis in Ukraine last year marked a period of tense diplomatic relations between Russia and the United States. The invasion and annexation of Crimea in 2014 built up to a new proxy war within a year between the two superpowers, with Ukraine as its unfortunate battleground. The conflict never evolved into all-out between the Russia and the U.S., thankfully, but did become a very high-stakes two player game. As the article describes, economists Richard Ericson and Lester Zeager modeled the Ukraine crisis as a game where Russia and the U.S. are the players and implementing unilateral policy changes – or choosing not to – serve as their strategies (the exact policy changes are explained in the article). This is a more complex example of game theory compared to the examples we have seen in class, as there are more strategies involved and players can make multiple moves, making the Nash Equilibrium difficult to determine.

What I find amazing is that the two economists were able to create this model using coverage of the situation in Ukraine from U.S. media and use mathematical procedures to predict the equilibrium of this “game.” It demonstrates the importance and applicability of game theory in all different kinds of situations, and how it’s possible to model a game with novel sources of information. Even though this was a more complicated example of a game, it was still possible to calculate the equilibrium using matrices. In the case of the Ukraine crisis, Ericson and Zeager found that possible equilibriums were either “sanctions/destabilize” – where Russia continues to destabilize the region and the West continues to institute sanctions against Russia – or “business as usual/destabilize”, where the West chooses not devote efforts to preserving a democratic Ukraine. These possible outcomes were based off of the assumption that both players remained rational – that is, choose not to use excessive force, in which case armed conflict in Ukraine would’ve escalated. According to their simulations, the game would finish in a few moves, in which case it might’ve been over in the real world by the time the article was written!

Comments

Leave a Reply

Blogging Calendar

September 2016
M T W T F S S
 1234
567891011
12131415161718
19202122232425
2627282930  

Archives