Von Neumann & the Bomb
Strategy is not concerned with the efficient application of force but with the exploitation of potential force (T. Schelling, 1960, p. 5).
UNIT I: Overview & History
• Introduction: What is Game Theory?• Von Neumann and the Bomb• The Science of International Strategy• Logic of Indeterminate Situations
2/2
Von Neumann & the Bomb
• A Brief History of Game Theory• Dr.Strangelove• Military Decision & Game Theory• The Science of International Strategy• The Prisoner’s Dilemma • Securing Insecure Agreements• Postwar Economic Regimes
A Brief History of Game Theory
Minimax Theorem 1928
Theory of Games & Economic Behavior 1944
Nash Equilibrium 1950
Prisoner’s Dilemma 1950
The Evolution of Cooperation 1984
Nobel Prize: Harsanyi, Selten & Nash 1994
Dr. Strangelove
John von Neumann (1903-57).
• Hilbert program• Quantum mechanics• Theory of Games & Economic Behavior• ENIAC• The Doomsday Machine
The Doctrine of Military Decision
•Step 1: The Mission•Step 2: Situation and Courses of Action •Step 3: Analysis of Opposing Courses of Action•Step 4: Comparison of Available Courses of Action•Step 5: The Decision
Source: O.G. Hayward, Jr., Military Decisions and Game Theory (1954).
Military Decision & Game Theory
A military commander may approach decision with either of two philosophies. He may select his course of action on the basis of his estimate of what his enemy is able to do to oppose him. Or, he may make his selection on the basis of his estimate of what his enemy is going to do. The former is a doctrine of decision based on enemy capabilities; the latter on enemy intentions. (O. G. Hayward, Jr. 1954: 365)
Military Decision & Game Theory
Source: O. G. Hayward, Jr. 1954
Southern Route
BISMARCK SEA
Northern Route
Rain
ClearWeather
NewGuinea
New Britain
NorthernRoute
SouthernRoute
Northern SouthernRoute Route
2 days 2 days
1 day 3 days
Japan
US
Battle of the Bismarck Sea, 1943
Military Decision & Game Theory
Source: O. G. Hayward, Jr. 1954
Southern Route
BISMARCK SEA
Northern Route
Rain
ClearWeather
NewGuinea
New Britain
NorthernRoute
SouthernRoute
Northern SouthernRoute Route
2 days 2 days 2
1 day 3 days 1
Japan
US
Battle of the Bismarck Sea, 1943
USmin
2
1
Jmax 2 3
Military Decision & Game Theory
• Game theory lent itself to the analysis of military strategy, casting well accepted principles of decision making at a rigorous, abstract level of analysis.
• In situation of pure conflict, the “doctrine of decision based on enemy capabilities” and game theory point to the value of prudence: maximize the minimum payoff available.
Schelling’s Theory of Strategy• Conflict can be seen as a pathological (irrational)
state and “cured;” or it can be taken for granted and studied – as a game to be won (1960: 3).
• Winning doesn’t mean beating one’s opponent; it means getting the most out of the situation.
• Strategy is not concerned with the efficient application of force but with the exploitation of potential force (5).
Schelling’s Theory of Strategy[I]n taking conflict for granted, and working with an image of participants who try to ‘win,’ a theory of strategy does not deny that there are common as well as conflicting interests among the participants (Schelling 1960: 4).
ZEROSUM NONZEROSUM
PURE MIXED PURECONFLICT MOTIVE COORDINATION
Schelling’s Theory of Strategy
Pure Coordination Pure Conflict
1, 1 0, 0 0, 0
0, 0 1, 1 0, 0
0, 0 0,0 1, 1
-1, 1 1, -1
1, -1 -1, 1
Schelling’s Theory of Strategy
And here it becomes emphatically clear that the intellectual processes of choosing a strategy in pure conflict and choosing a strategy of coordination are of wholly different sorts. . . . [I]n the minimax strategy of a zero-sum game . . . one’s whole objective is to avoid any meeting of minds, even an inadvertent one. In the pure-coordination game, the player’s objective is to make contact with the other player through some imaginative process of introspection, of searching for shared clues (96-98).
·
Realism
• The actor (nation-state) is rational: goal-directed, concerned with maximizing power or security.
• The environment is anarchic: there is no supervening authority that can enforce agreements.
• The solution is an equilibrium or balance of power, enforced by the interests of those involved w/o the need for external enforcement mechanisms.
Schelling’s Reorientation
• In the 1940s and ’50s, game theory lent itself to the analysis of military strategy, casting Realist principles and assumptions at an abstract level of analysis.
• Von Neumann’s minimax theorem and the doctrine of military decision both recommend prudence: maximize the minimum payoff available.
• Given Realist assumption, conflict is inevitable. The Security Dilemma arises because one nation’s attempt to increase it’s security decreases the security of others.
• Arm Races (e.g., WWI). Is security zero-sum?
Schelling’s Reorientation
The Security Dilemma• The actor (nation-state) is rational, i.e., goal-directed,
egoistic, concerned with maximizing power or security.
• The structure of the international system is anarchic – meaning there is no supervening authority that can enforce agreements.
• Given these conditions, nations often fail to cooperate even in the face of common interests.
• The dilemma arises because one nation’s attempt to increase it’s security decreases the security of others.
Schelling’s Reorientation
• In the 1940s and ’50s, game theory lent itself to the analysis of military strategy, casting Realist principles and assumptions at an abstract level of analysis.
• Von Neumann’s minimax theorem and the doctrine of military decision both recommend prudence: maximize the minimum payoff available.
• Given Realist assumption, conflict is inevitable. The Security Dilemma arises because one nation’s attempt to increase it’s security decreases the security of others.
• Arm Races (e.g., WWI). Is security zero-sum?
Schelling’s Reorientation
The Reciprocal Fear of Surprise Attack
The technology of nuclear warfare created a fundamentally new kind of arms race – the speed and devastation of the new generation of weapons meant that “[f]or the first time in the history of the world, it became possible to contemplate a surprise attack that would wipe the enemy off the face of the earth ... . Equally important, each nation would fear being the victim of the other’s surprise attack” (Poundstone, 1992, p. 4).
Schelling’s Reorientation
The Prisoner’s DilemmaThe prisoner’s dilemma is a universal concept. Theorists now realize that prisoner’s dilemmas occur in biology, psychology, sociology, economics, and law. The prisoner’s dilemma is apt to turn up anywhere a conflict of interests exists (..) . Study of the prisoner’s dilemma has great power for explaining why animal and human societies are organized as they are. It is one of the great ideas of the twentieth century, simple enough for anyone to grasp and of fundamental importance (...). The prisoner’s dilemma has become one of the premier philosophical and scientific issues of our time. It is tied to our very survival (Poundstone,1992: 9).
The Prisoner’s Dilemma
In years in jail AlConfess Don’t
Confess
Bob
Don’t
10, 10 0, 20
20, 0 1, 1
Bob thinks:
If Al C(onfesses), I should C, because 10 < 20 and 0 < 1, thus C is better than D(on’t), no matter whatAl does.
We call Confess adominant strategy.
The Prisoner’s Dilemma
In years in jail AlConfess Don’t
Confess
Bob
Don’t
10, 10 0, 20
20, 0 1, 1
Because the game is symmetric, both prisoner’s Confess, even though they are better off if both Don’t.
CC is inefficient.
If we assign P(ayoffs),so that the players try to maximize P . . .
The Prisoner’s Dilemma
In Payoffs AlConfess Don’t
Confess
Bob
Don’t
1, 1 5, 0
0, 5 3, 3Again, the outcome isinefficient.
If we assign P(ayoffs),so that the players try to maximize P . . .
The Prisoner’s DilemmaCommunication? We have assumed that there is no communication between the two prisoners. What would happen if they could communicate?
Repetition? In the Prisoner’s Dilemma, the two prisoners interact only once. What would happen if the interaction were repeated?
2- v. n-person Games? The Prisoner’s Dilemma is a two-person game, What would happen if there were many players?
Dominance Reasoning? Compelling as the reasoning is that leads to the dominant strategy equilibrium may be, it is not the only way this problem might be reasoned out. Is it really the most “rational” answer after all?
Next Time
2/9 The Logic of Indeterminate Situations.
Schelling, Strategy and Conflict: 53-80.
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