Confess, Always Confess!

Now most people might think economics is super boring and no one ever has fun, but you're wrong! There are all sorts of games in economics such as simultaneous games. A simultaneous game is when people have to make a choice simultaneously without knowing what the other person will choose, its all based on strategic choices. 

trying to play monopoly with Kern

The most important things in simultaneous games is that you MUST think about the other player before yourself. Now I'm not saying be considerate of others and think how much winning the game would mean to them-NO I'm saying think like them. If you know what your opponent will do then you know what your best choice will be based on what you know they will choose. It's kind of the opposite of being considerate, you're thinking about how they could play and then how you could play better than them.

The next thing you need to know about simultaneous games is that there are 2 main types: constant sum and variable sum. In constant sum the payoff of both players will always add up to a sum of 100%. In variable it doesn't, in this game players often will share a common interest. For an example of constant sum, imagine there are 2 television networks trying to decide if they should start a new sitcom or game show. Network 1 has higher rating percentages with sitcoms and Network 2 does with game shows. This means that the Nash equilibrium will be the like choice of the networks, so when Network 1 chooses sitcom and Network 2 chooses game show. Nash Equilibrium is when a player's best strategic choice coincides with their opponent's best choice. A player can also have a dominant strategy if they have 1 strategy that has a higher payoff than their others regardless of what their opponent chooses. 

The most known simultaneous game is the prisoner's dilemma. Imagine that you and your best friend get arrested and a detective offers you a shorter sentence or maybe even no sentence at all to confess and sell out your friend. You know they are also going to be offering this deal to your friend as well so now you have to decide, should I confess or not?

Well the answer is yes, always confess! Looking at the image above if these were the deals that the detective gave you it's always better to confess because at most you can get 5 years, which is a lot better than 20. 

Yes it's true snitches get stitches but looking at the odds I'd rather spend at max 5 years in jail than 20 so to my future criminal friends don't trust me not to sell you out.