Choices, Games & Branching Paths

Choices That Depend on Other People

Also called: Game theory

Personal interest
Formal theory

My best choice often depends on what other people want and how they will respond. Game theory studies exactly that. It appeals to me because choices that make sense for each person can still add up to a poor result for the group as a whole.

Whose incentives could make the choice that looks best fall apart?

Why it attracts me

Much of the engineering I enjoy treats a system as something to optimize. Jobs, machines and queues do not change their behavior because I changed mine. People do. Game theory is the study of choices where the result depends on what several people decide, and each of them is thinking about the others.

The idea

A game, in this sense, needs players, the choices open to each, and how much each player values each possible result. The surprising lesson is that sensible individual choices can add up to a poor shared result. The prisoner's dilemma is the classic case: each player does better by not cooperating, whatever the other does, yet both end up worse off than if both had cooperated. John Nash's idea of a point where no one gains by switching alone (John Nash: When No One Gains by Switching) describes the points where games like this can settle.

An example

In my Scheduling Optimization Lab, seven jobs wait for one machine, and I can check all 5,040 possible orders to find the best one. The jobs never react. Now imagine each job belonged to a different team that could jump the queue or pad its deadline. The best order on paper might stop being followed. That gap between optimization (Finding the Best Plan Within Limits) and a game is what interests me.

Where it connects

Games repeat, and trust changes them (Trust Built Over Many Rounds). Sometimes the best move is to change the game itself (Cooperation by Changing the Game). And some relationships involve strategy without being only strategy (Love Is Not Something to Maximize).

Questions I'm still exploring

When is it fair to treat a person as a player with goals, and when does that miss too much?
How often do good individual choices add up to a bad shared result in everyday life?
Can understanding the game make me kinder rather than more calculating?

Sources and further reading

Stanford Encyclopedia of Philosophy, "Game Theory"
John von Neumann and Oskar Morgenstern, Theory of Games and Economic Behavior (Princeton University Press, 1944)

In short

Game theory is the mathematics of decisions where the result depends on what several people choose. Each player has options and cares about the possible results in their own way. The theory asks what each player is likely to do, knowing that the others are thinking too. Its best-known lesson is that choices that make sense for each person on their own can add up to a worse result for the whole group than it could have had.

Why this matters to me

As an industrial engineer, I often think about systems whose parts do not argue back: machines, queues and schedules. People do argue back. A schedule, a team plan or a household routine works only if the people in it have reasons to follow it. Game theory gives me a language for that: who wants what, who responds to whom, and why sensible individual choices can still produce a poor shared result.

Connections

Love Is Not Something to MaximizeTension

Relationships involve choices that affect each other, but love is more than a calculation of who gets what.

Finding the Best Plan Within LimitsContrast

Optimization picks the best plan for a fixed model of the world. Game theory adds other people, who have their own goals and respond to my choices.

Life as an Evolving GamePart of

Picturing life as a game includes game theory: the study of choices where the result depends on what other people choose too.