3. Prisoner's Dilemma

Introduction

. Consider this situation:

The Prisoner's Dilemma involves 2 suspects have been arrested for a serious crime; they are interrogated separately and each has the choice of incriminating the other (in return for leniency by the authorities) or maintaining silence (which will leave the police with inadequate evidence for a case, if the other prisoner also stays silent). Thus each prisoner has a choice, ie to incriminate the other person or not.

Remember: there is no prior agreement between the 2 suspects on how to handle this situation; there is no plan to communicate during the activity; there is no loyalty between the two suspects or favours owed. The aim for each "suspect"is simply to act in his/her best interest.

Separately each suspect is informed that if he/she implicates the other suspect, and if the other suspect remains silent, he/she will be set free and receive a reward. If this happens, the second suspect will receive the maximum prison sentence. Similarly, the reverse replies: the first suspect will get the maximum prison sentence if the second suspect implicates him/her and the first suspect remains silent. Secondly, if both suspects implicate each other, then both will receive the minimum prison sentence. Thirdly if both remain silent, both of them will be set free as the police will lack evidence for a conviction.

Comments on the activity

. This is a similar example to the Traveller's Dilemma.

. The game's options and payoffs are shown below

   

Other suspect (B)

 
   

Implicate other suspect

Stay silent

One suspect

(A)

Implicate suspect

A: Minimum sentence

B: Minimum sentence

A: Set free & reward

B: Maximum sentence

 

Stay silent

A: Maximum sentence

B: Set free & reward

A: Set free

B: Set free

. The best overall outcome, viewing the situation from outside, is for both suspects to stay silent. In other words, they cooperate with each other. But what is the rational, self-interested thing to do? If one suspect implicates the other, the best approach will be for other to implicate him/her. Otherwise the first suspect could receive the maximum prison sentence rather than the minimum sentence. On the other hand, if the other suspect stays silent, once again the rational thing to do is to implicate the first suspect: he/she will not only stay out of prison, but he/she will also receive a reward.

. Irrespective of what the other suspect chooses to do, the best course of action is to implicate him/her, or defect.

"... although staying silent (choosing to cooperate) would be better all-around, rational self-interest tells you to defect. That is why the prison's dilemma is so called. Self interested individuals do not necessarily choose the best overall outcome..."

Robert Winston, 2003

. Both suspects should choose to defect, implicate each other, and both will get the minimum prison sentence. Co-operation will be undermined by this tendency to defect, because defection pays.

"...the prisoner's dilemma teaches us a lesson that can be applied to many non-zero sum games. If rational self-interest is the rule, then taxes may not get paid......public toilets do not get built......there are many situations in economics that show that self-interest amongst all the agents concerned can produce the worst outcome overall, from tax dodging to price-fixing cartels.....Why are we assuming the players in the prisoner's dilemma are guided solely by their own self-interest. The reason is that as a result of investigating the evolution of human co-operation we can rely on the fact that the genes are selfish; they are successful only if they act in their own self-interest. Ignoring kin selection, and assuming that we wish to find out if co-operation can evolve between strangers, the assumption of genetic self-interest is extremely important. Long-term strategies to co-operate or defect will only be successful if the strategy is in the best interest of the individual. But for a particular strategy to spread throughout a population, two conditions need to be met. The first is that the strategy must, in the long-term, benefit each individual who is using it. The second is that the policy must be stable within the population - in other words, it needs to be an evolutionary stable strategy and must not be susceptible to any other, more successful strategy..."

Robert Winston, 2003

(source: Robert Winston., 2003)

 

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