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Game Theory & the cuban missile crisis

Game Theory & the cuban missile crisis. What is Game Theory?. A branch of mathematics concerned with decision-making in social interactions. Games = situations Players = participants Strategies = possible actions

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Game Theory & the cuban missile crisis

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  1. Game Theory & the cuban missile crisis

  2. What is Game Theory? • A branch of mathematics concerned with decision-making in social interactions. • Games = situations • Players = participants • Strategies = possible actions • Nash Equilibrium: combination of two strategies from the players that are “stable”, in that neither player can do better

  3. Cuban Missile Crisis Strategies United States • Naval Blockade (B) – prevent shipment of more missiles, possibly followed by stronger action to induce USSR to withdraw missiles already installed • Air Strike (A) – wipe out missiles already installed, possibly followed by invasion of the island Soviet Union • Withdrawal (W) – remove their missiles • Maintenance (M) – maintain their missiles

  4. Soviet Union Withdrawal (W) Maintenance (M) United States Blockade (B) Air Strike (A) Key (x,y) = (payoff to U.S., payoff to USSR) 4=best, 3=next best, 2=next worst, 1=worst

  5. Prisoner’s Dilemma • 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 and the other remains silent, the talker goes free and the silent accomplice receives the full one-year sentence. If both remain silent, both prisoners are sentenced to only one month in jail for a minor charge. If each betrays the other, each receives a three-month 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?

  6. Prisoner B Remain Silent Talk Prisoner A Remain Silent Talk

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