The Game Theory of New Zealand’s Politics
This article applies game theory to New Zealand’s current political climate. It details recent decisions made by the New Zealand legislature to blow significant government funding on things that are not exactly necessary. The author of this piece decides to point out the government’s decision to spend a cool $30 million on several state-of-the-art horse racing tracks. The national Green Party has a platform that goes directly against this sort of allocation of funding, but provided no obstacle in securing it. Game theory tells us why.
The dominant party in New Zealand’s legislature is the relatively conservative NZ First party. While the Green party holds votes, they are nowhere close to a majority. In recent times, the NZ First party has voted for several Green party initiatives, such as a check-out bag ban and increasing public transport funding. If the Green party were to vehemently oppose the horse racing track funding, the NZ First party could just easily vote down anything the Green party ever proposes.
The New Zealand legislature is in a Nash equilibrium as it currently stands: the Green party is able to enact some occasional legislation at the expense of remaining silent as the NZ First party allows questionable budget allocation. If the Green party were to challenge this budget allocation, they would no longer be able to enact any legislation, reducing their utility (payoff). If the NZ First party arbitrarily decided to shut down all Green party action in the legislature, then the Green party would talk to the press and voters about the NZ First party’s dubious budgeting. This is obviously not ideal, as it could result in the NZ First party losing their majority vote. As a result, their utility (payoff) would also decrease. Since neither party has an incentive to change their action, we find ourselves at a Nash equilibrium.
Game theory and NZ Coalition Politics : Agenda Setters, Co-operation, Triumph and Suckers