Tuesday, February 15, 2011

The Prisoner's Dilemma

The prisoner's dilemma is a fundamental problem in game theory that demonstrates why two people might not cooperate even if it is in both their best interests to do so.

Two suspects are arrested by the police. The police have insufficient evidence for a conviction, and, having separated the prisoners, visit each of them to offer the same deal. If one testifies for the prosecution against the other (defects) and the other remains silent (cooperates), the defector goes free and the silent accomplice receives the full 10-year sentence. If both remain silent, both prisoners are sentenced to only six months in jail for a minor charge. If each betrays the other, each receives a five-year sentence. Each prisoner must choose to betray the other or to remain silent. Each one is assured that the other would not know about the betrayal before the end of the investigation. How should the prisoners act?

I'm posting The Prisoner's Dilemma (PD) because I've some issues with it.

First, watch its description:

I will come back and post my questions about:

(1) Douglas Hofstadter's Superrationality

(2) Continuous iterated prisoner's dilemma

(3) What is defined as ‘rational’ in economic game theory

Here's a humorous description of PD

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