Bryan Caplan and David Henderson

Game Theory

A Category Archive (47 entries)

George Mason University's Economics in Action

Economic Education
David Henderson
David Chandler Thomas is a Ph.D. student in George Mason University's economics program. I had highly recommended him to the program after having been his thesis advisor. (San Jose State University, where he earned his Masters' degree had asked me... MORE

Looking for Love in the Laboratory

Economic Education
Bart Wilson
The last experiment in Humanomics is a variation of a treatment in an article by Mary Rigdon, Kevin McCabe, and Vernon Smith. In my version, people are paired to play the following extensive form game: Person 1 makes the first... MORE

Hobbesian Misanthropy in The Purge

Behavioral Economics and Rationality
Bryan Caplan
Remember my Hobbesian thought experiment?Suppose a random person is living on a desert island without hope of rescue. Call him the Initial Inhabitant, or I.I. Another random person unexpectedly washes up on shore, coughing up water. Call him the New... MORE

Gaming on EconLog: A History of Nerddom

Economics and Culture
Bryan Caplan
Today I'm taking my twins to their first GenCon, the world's biggest gaming convention.  In honor of this glorious day, here are my top gaming related EconLog posts.1. The Secret of Good Games2. The Sociology of RPGs3. The Social Science... MORE

Free Markets to the Rescue

Regulation
David Henderson
One of my biggest disagreements with fellow libertarians is on the issue of optimism versus pessimism. I tend to be an optimist, while some fellow libertarians--I have in mind my friend Robert Higgs as an extreme example--tend to be pessimists.... MORE

End Military Aid to Israel and Egypt and ...

Game Theory
David Henderson
Corinne and Robert Sauer, founders of the Jerusalem Institute for Market Studies, have taken up a proposal put forth in 2003 by Erez Raphaeli, an independent researcher. He contended that ending the nearly $5 billion in annual U.S. military aid... MORE

Brinksmanship and the Obama-Bush Tax Cuts

Fiscal Policy
Garett Jones
Matt Yglesias is claiming that POTUS and Congressional Democrats can safely ignore John Boehner: To take the bargaining process seriously at this point you have to believe that come 2013, House Republicans would actually refuse to cut taxes on the grounds... MORE

How Would a Georgist Single Tax Work in Monopoly?

Economic Education
Bryan Caplan
Another fascinating aside from Larry White's The Clash of Economic Ideas (Kindle price just $23.40):Georgist theory was even the inspiration for the board game Monopoly.  The game's original creator called it "The Landlord Game" and intended it to illustrate the... MORE

Group IQ: One Source of Trustworthiness

IQ in Economics
Garett Jones
In Arnold's new essay entitled "Libertarians and Group Norms," he writes:[W]e live in a world that demands enormous levels of trust among strangers...I doubt that anyone fully comprehends what holds this fabric of trust together. I agree.  But we're building comprehension,... MORE

PBR, once again

Regulation and Subsidies
Arnold Kling
Kyle writes, Kling's line is very simple: 1. Ideal regulatory systems can be modeled as games. 2. Regulators *try* to solve problem by creating regulations. 3. The regulated participants *try* to circumvent regulations by following the letter of the law,... MORE

Why Are Donations to Government So Small?

Economic Philosophy
Bryan Caplan
My new baby has delayed my intended post on the Matt Zwolinski-Will Wilkinson debate, but late is better than never.  Matt kicked it off:[W]hile government is, in principle, able to do some good, there are very often (almost always?) superior... MORE

Bruce Schneier's Latest Book

Books: Reviews and Suggested Readings
Arnold Kling
It's Liars and Outliers, and I would rate it the best economics book of the year thus far. He writes about his book here and here. Schneier views our lives from the perspective of game theory. Every day, we must... MORE

Euro-Optimism

Game Theory
Arnold Kling
C. Fred Bergsten and Jacob Funk Kirkegaard (BK) write, There are only two alternatives. Europe can jettison the monetary union. Or it can adopt a complementary economic union. This brief argues that, for all the turmoil, Europe is well on... MORE

A Pessimistic Prediction

Politics and Economics
David Henderson
In which the author predicts an attack in or near Las Vegas. A few weeks ago I made a few optimistic predictions and a few pessimistic ones. My optimistic ones tend to be about how even semi-free markets will solve... MORE

Nash Equilibrium in Higher Education

Economics of Education
Bryan Caplan
In a Nash equilibrium, every actor maximizes his utility given the behavior of all the other actors.  Arum and Roksa's Academically Adrift contains one of the best (implicit) applications of the concept I've ever read.  They name all the key... MORE

Deception, Detection, and Democracy at GenCon

Behavioral Economics and Rationality
Bryan Caplan
At this year's GenCon, I discovered a thought-provoking game: "Are You a Werewolf?" - a.k.a. "Mafia."  The game's a brilliant exploration of cheating, cheater detection, and democratic information aggregation.  The basic set-up:1. There are 15 players and a moderator.  2.... MORE

Pacifism and Repeated Prisoner's Dilemma

Game Theory
Arnold Kling
Tyler Cowen argues with Bryan on pacifism. There is also a Lucas critique issue of how the bad guys start behaving once they figure out that the good guys are pacifist, and I don't see him discussing that either. I... MORE

Solving Othello: a Follow-Up

Game Theory
Arnold Kling
This is an off-topic response to comments on my earlier off-topic post on the board game Othellotm. I believe that it could be solved using today's computers, by truncating the decision tree whenever a player is in a clear losing... MORE

Chickens for Peace

Game Theory
Bryan Caplan
David Friedman's dinnertime conversations with his son Bill inspired the following hypothetical:Imagine that someone in our future is equipped with a device capable of delivering packages to the past. He makes a list of thirty or forty of the most... MORE

Sanctions and Game Theory

Game Theory
David Henderson
Jacob Hornberger had an insightful blog post on Friday in which he applied basic game theory to the issue of sanctions. He didn't use the term "game theory," but he did the key thing that game theorists do: in thinking... MORE

A reader writes, If the price-insensitive people are at home avoiding the crowds then it would seem the online stores would be getting shopped by a higher than average percentage of price-insensitive people. It appears to me the 'price discrimination'... MORE

The Real Meaning of Privilege

Game Theory
David Henderson
Once we start using the word "privilege" where what we really mean is "wealth," we start applying this term to those who came by their wealth without special privilege-the Bill Gateses of the world, sure, but also the more-common successful... MORE

Backwards Induction in The Lookout

Game Theory
Bryan Caplan
The Lookout is not just one of the best modern crime flicks you've never heard of.  It's also the most compelling dramatic depiction of backwards induction I can remember.  The lead character has trouble sequencing his actions (wake up, shower,... MORE

Here's a question from my final exam for Ph.D. Micro.  Care to give it a try in the comments? Suppose that greeting other people is a special kind of Coordination game.  We are in the equilibrium where everyone shakes hands;... MORE

Lunch with John Nash

Game Theory
David Henderson
Nobel prize winner John Nash is visiting my school, the Naval Postgraduate School, this week and is giving a speech tomorrow to the student body. Some of my economist colleagues and I had lunch with him today. He seems to... MORE

Futarchy in Camden, Maine

Game Theory
Arnold Kling
Do you like prediction markets as much as Bryan and Robin? Then try Pop!Tech prediction market.... MORE

Libertarian Misanthropes

Game Theory
Arnold Kling
First, there's South Bend Seven. I'm still waiting for the plan that requires volunteering* from able bodied retirees as a condition of receiving their social security checks, or requires a few hours a week of service from anyone getting unemployment... MORE

Nobel Prize in Abstraction

Game Theory
Arnold Kling
From this year's citation While direct mechanisms are not intended as descriptions of real-world institutions, their mathematical structure makes them amenable to analysis. Finding the best of all direct mechanisms for a given problem is often straightforward, and once the... MORE

Why GenCon Should Be Tax Deductible

Game Theory
Bryan Caplan
Tomorrow I'm flying to the world's greatest experimental game theory conference: GenCon. 25,000 people will play games of every description. If you believe in the project of experimental game theory, it's a data feast. I'd probably get audited by the... MORE

Singularity Watch

Game Theory
Arnold Kling
MSNBC reports The results are in from the great "Man vs. Machine" computer poker showdown in Vancouver, with the humans coming out on top by a narrow margin. ...The Polaris team as well as Laak and Eslami are all looking... MORE

Soon after the first Iraq torture scandal, I remember a pompous politician declaring (more or less) that "The reason why we don't torture prisoners is so American soldiers don't get tortured." Whatever you think about torture, this argument seems underwhelming.... MORE

Strictly Preferred to the AEA Meetings

Game Theory
Bryan Caplan
One week from today, I'll be at the world's most important conference on advanced game theory and experimental economics: GenCon. My dream is to make it the Schelling point around which creative social scientists gather. Who's with me?... MORE

The Common Sense of Scapegoating

Game Theory
Bryan Caplan
Suppose your long-term enemy has compromised himself somehow. You're in a position to demand satisfaction, but his position is too strong to actually get rid of him. What could you do instead? In practice, a common solution is to insist... MORE

Suppose you have a secret that the world will hold against you, but it's sure to leak out one day regardless of what you do. What's the best way to come out of the closet? I started thinking about this... MORE

Two-person Sudoku

Game Theory
Arnold Kling
Here's an idea for an entrepeneur.... MORE

Backwards Induction in Oldboy

Game Theory
Bryan Caplan
The latest great fictional depiction of backwards induction is the Korean thriller Oldboy. Not for the faint of heart, but when the villain says (roughly) "You shouldn't have been wondering why I locked you up. You should have been wondering... MORE

Tolstoy and the Great Man Theory

Game Theory
Bryan Caplan
Most historians tell stories in which the decisions of a few Great Men drastically change the fates of millions. Prinzip started World War I by assassinating Archduke Franz Ferdinand, Stalin collectivized agriculture, and Hitler ordered the Holocaust. Tolstoy wrote his... MORE

[Warning: Sith spoilers!] Whenever I meet a promising new graduate student, it isn't long before I mention the practical importance of backwards induction. (For a short definition, see here; for a longer treatment, check this out). "What's your career goal?"... MORE

Tariffs, Quotas, Games, and Drugs

International Trade
Arnold Kling
Gary Becker makes the case against the drug war. After totaling all spending, a study by Kevin Murphy, Steve Cicala, and myself estimates that the war on drugs is costing the US one way or another well over $100 billion... MORE

See Saw

Game Theory
Bryan Caplan
The excellent Saw comes out on DVD this Tuesday. If you've got a cast-iron stomach, there is no better fictional exploration of the Prisoners' Dilemma available. (If you don't have a cast-iron stomach, may I suggest Pooh's Heffalump Movie?) The... MORE

News of an Israeli-Palestinian cease fire reminds me of Tyler's Cowen's excellent game theoretic exploration of their long struggle. This essay is worth a thousand news stories on the subject, but I still think that Tyler misses the simplest explanation... MORE

eBay, Fun, and Social Waste

Behavioral Economics and Rationality
Arnold Kling
David Weinberger has some thoughts about eBay. I've lost bids to auction snipers. As a customer, I feel cheated, even though, of course, I could take a sniper's eye-view of the transaction. Even if letting robots game the auction doesn't... MORE

Economics of Content

Information Goods, Intellectual Property
Arnold Kling
Clay Shirky writes that the Internet helps to break the link between fame and economic success for writers. For an author to be famous, many people had to have read, and therefore paid for, his or her books. Fortune was... MORE

Auction Toxic Waste?

Energy, Environment, Resources
Arnold Kling
How should the location of undesirable land uses, such as toxic waste dumps or prisons, be determined. Citing Julian Simon, Herbert Inhaber suggests using a reverse auction, in which the Federal government offers to compensate local residents for living near... MORE

Comment of the Week 2003-02-27

Game Theory
Arnold Kling
This week, I give the award to this comment by Zimran. Talking about the issue of airline profitability, he writes in part the airline industry also has perennial over capacity. Companies may enter and exit the market, but the planes... MORE

The Airline Union Game

Game Theory
Arnold Kling
'Jane Galt' gives an explanation for airline bankruptcies . In single-union negotiations, money left on the table now can be partially reclaimed by demanding higher wages in the next round of negotiations. Not so with multi-lateral arrangements. Any money left... MORE

Romance or Signalling Game?

Game Theory
Arnold Kling
Economists sometimes seem to be incurable anti-romantics. Consider James Miller's treatment of Valentine's Day as a signalling game. Even a woman who hates flowers would be rational in getting mad at her boyfriend for not buying her flowers on Valentine's... MORE

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