The Story of Conflict and Cooperation
17 Pages Posted: 29 Aug 2018
Date Written: August 19, 2018
The story of conflict and cooperation has started millions of years ago, and now it is everywhere: In biology, computer science, economics, humanities, law, philosophy, political science, and psychology. Wars, airline alliances, trade, oligopolistic cartels, evolution of species and genes, and team sports are examples of games of conflict and cooperation. However, Nash (1951)’s non-cooperative games — in which each player acts independently without collaboration with any of the others — has become the dominant ideology in economics, game theory, and related fields. A simple falsification of this non-cooperative theory is scientific publication: It is a rather competitive game, yet collaboration is widespread. In this paper, I propose a novel way to rationally play games of conflict and cooperation under the Principle of Free Will — players are free to cooperate to coordinate their actions or act independently. Anyone with a basic game theory background will be familiar with the setup in this paper, which is based on simple game trees. In fact, one hardly needs any mathematics to follow the arguments.
Keywords: conflict, cooperation, strategy, backward induction, forward induction
JEL Classification: C70, D74
Suggested Citation: Suggested Citation