Everything you need to know about Strategy in 6 mins- solving prisoner's dilemma

Despite this clip being a classic classroom example in a game theory course, it's technically not a prisoner's dilemma, for a couple reasons. First, in the PD the players cannot communicate. The ability to communicate makes it more of a signalling game since a player can say/do something to alter the other players' beliefs about their type.

Secondly, in the PD both players have an incentive to defect from their cooperative strategy (stay silent), which results in a Nash equilibrium where both players are worse off. This is, after all, why the prisoner's dilemma is so interesting -- by playing their dominant strategies, both players end up in a worse situation.

In this clip, stealing is a weakly dominant strategy. That is, if I know the other guy is going to steal, I can't be made any better or worse by changing my choice to split or steal. If I know the other guy is splitting, then I of course would want to steal (which is why splitting is an unstable strategy).

By telling his strategy (“100%, I’m going to steal”), the first player forced the endgame he wanted. The second player had no option other than choose split in the hope he gets something. If the first player had instead manifested his interest in splitting, the second player would have no rational reason to not choosing to steal.

It's an interesting twist on the prisoner's dilemma, and the first player played it accordingly.

Even more interesting is this other video, which shows how cooperation without punishment doesn't work:

http://www.youtube.com/watch?v=flPaDwiqP_o#t=149

Certainly an intersting clip, but not an instance of prisoner's dilemma: http://en.wikipedia.org/wiki/Golden_Balls#Split_or_Steal.3F

And it's a completely ridiculous claim that it's "everything you need to know about strategy"...

As others have pointed out this is not a true prisoners dilemna. Nonetheless, an interesting side-note is after saying that he was going to steal the whole time, he had to choose split (under the assumption that he is acting as a team player). This is because it would be inefficient if the other player chose steal simply out of spite/distrust and the team walks away with nothing.

So is this the guy that's advised the Republicans in congress to ruin our country's credit rating as a bargaining maneuver with the stupid 'Debt Ceiling Debate'?

"Alex Patton is a media & communications expert, Republican political consultant"

We've based an economy around a schizophrenics depraved game of chicken. That's what all this shit boils down to.

I like the original title Political Strategy Master Session in 6 Minutes better than this one, but so be it.

Deeply understanding prisoner's dilemma helps explain a lot of office politics. Why are people at software firms more willing to ruffle feathers than at insurance companies? Because their prisoners dilemma games are shorter. How do you make sure that someone doesn't reneg on a deal? Make sure they see the game is longer than just 1.

It's not the be-all end all of strategy, but it's very interesting.

Further reading on coopetition:

http://en.wikipedia.org/wiki/Coopetition

http://www.amazon.com/Co-Opetition-Adam-M-Brandenburger/dp/0...

I hate the word co-opetition, because it's a much deeper topic than "Why can't we all get along?" or "Why can't we manipulate each other into not competing?" That said, it's worth understanding.

As we all know, most illustrative game theory exercises are highly simplistic. I should have been more careful in my language choice stating that this was a variation of the classic prisoner's dilemma.

Why this is a master's lesson in strategy is two fold: 1) It cuts to the heart of the matter that all strategy is based on credibility. One would just need to look around at current events to see this play out. 2) It also illustrates that making the punishment guaranteed and removing all doubt of misunderstanding are essential.

Thanks all for the comments. As far as wavesounds, you jump to conclusions.

In fact I don't think there's a reason for the second player not to trust the "steal" guy. After all its a verbal contract with thousands of witnesses.

This is absolutely brilliant! Thanks for sharing Alex.

In addition to some of the other issues people have noted, it's mysterious that someone would think the prisoner's dilemma is a "master lesson" in political strategy. Probably more interesting and relevant would be a more complicated example explaining why both strong and weak political players are rewarded by voting in coalitions.

(I didn't watch the video)