Former student RA tells me he has a better example of the prisoners' dilemma game than the standard one that involves students selling drugs. His example involves two young men trying to outwait each other at a young woman's apartment. [reproduced here with his permission]
Two guys are pursuing the same girl, and after a long night, both find themselves the last ones at her place with her. Both guys want to spend time with her, and desire for the other guy to be gone from the situation, which can be represented by a simple payoff matrix.Some further wrinkles:
If both guys decide to agree and leave right away, neither wins, but neither loses either, so they both get a payoff of 0 (cooperative solution).
If one guy leaves, regardless of what happens, he will feel as though in some ways he has "lost", giving him a negative payoff (call it negative 5) and his opponent a positive payoff (call it 10).
Now, if both guys try to wait each other out, both will likely end up leaving at the same time and not only fail in their desired goal of getting the girl alone, but also would have wasted a bunch of time in the process, giving them negative payoffs, but not as bad as if one had left (call it a payoff of negative one each).
The resulting equilibrium is that both men choose to stay, don't get their intended result, and waste a bunch of time they could have been doing something else productive. Thus, a non-cooperative solution is reached.
- Is this a single-play or a repeated game? If the two young men know each other (or even if they don't), they might have an expectation of playing this game against each other at some future date. If so, then the expected pay-off from trying to outwait the other player is much higher in that doing so can create a reputation effect — the next time they play the game, the opponent will know that you are willing to (try to) wait him out; as a result, he might resign and leave early.
- I see no benefit to playing tit-for-tat strategies with this version of the game — I wouldn't expect there to be very many repeat plays even if the game is not a single-play game.
- Surely in this game, unlike the prisoners' dilemma, the players would eventually find it to their advantage to communicate both during the game and ex ante .
- With ex ante and concurrent communication, can they not assign property rights between them and work out side payments, a la the Coase Theorem?
- And what does the young woman think while this game is being played? Is she flattered by the attention? Annoyed at being a target (or the object) of some economist's discussion of property rights and side payments)?
- If I agree in advance that I will be the one to leave early, what types of retaliation are feasible for you if I renege on the agreement and end up outwaiting you?