Tuesday, December 6, 2011

Models of conflict and cooperation between situational disparities of decision-makers.

Game-theoretic analysis has long been used to describe, predict, and explain behavior; game theory has also been used to develop theories of ethical or normative behavior and to prescribe such behavior.  In economics and philosophy, scholars have applied game theory to help in the understanding of good or proper behavior. 

W.T. Grandy Jr has pointed out that entropy, when strictly considered is a macroscopic quantity that refers to the whole system, and is not a dynamical variable and in general does not act as a local potential that describes local estimations.

While this has to be true under special circumstances, however, one can metaphorically think of entropic forces behaving like local physical forces. The approximation that constitutes classical irreversible thermodynamics is built on this metaphoric thinking. 

Social decision theory typically plays out via equilibrium, just as Voltaire centuries before wrote, the best of all possible worlds [for all players].  While useful this concept overlooks that equilibrium is an existence result, and simply can’t define payoffs that accurately reflect non-linear social entropy’s (desperate situations). 

Over focusing on equilibrium culminates in simple notions such as inefficient ideologies will not be chosen as strategy because they are not in equilibrium.  My point is that we must consider how to explain a player’s decision to choose a strategy off the equilibrium path.

The point is that terrorists, anarchists, political destructors (zombie cults), etc. cannot simply be dismissed as irrational or as rational fools.  I think we need to consider that our analytical and instrumental reason of positivism that lies at the heart of game theory cannot live up to the intricacies of social relations.

In further posts, I plan to develop this idea and attempt to develop useful model of payoffs that accurately reflect situational disparity of game players within the confines of Nash equilibria in compact, quasiconcave normal form games.

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