Blogs

John Nash won the Nobel Prize for an idea so simple you can explain it in 5 minutes. Yet this idea revolutionized economics, predicted Cold War outcomes, explains why you’re stuck in traffic, and even helps explain evolution. Let’s understand Nash Equilibrium-the most important concept in game theory. The Core Idea (In One Sentence) A Nash Equilibrium is a situation where no player can improve their outcome by changing their strategy alone-everyone is doing the best they can given what everyone else is doing. ...

In 1961, President John F. Kennedy stood before the American people and did something remarkable for a politician: he admitted total failure. The Bay of Pigs invasion-a CIA-backed attempt to overthrow Fidel Castro-had been an utter disaster. Over 1,400 Cuban exiles were captured or killed. It was a humiliating defeat, just three months into Kennedy’s presidency. Kennedy didn’t deflect. He didn’t blame his predecessor. He didn’t hide behind classified briefings. ...

Imagine you and a partner are arrested for a crime. The police separate you into different rooms and offer each of you the same deal. You can’t communicate. You don’t know what your partner will do. And the choice you make will determine whether you go free or spend years in prison. Welcome to the most famous problem in game theory: the Prisoner’s Dilemma. It reveals a disturbing truth about rational decision-making that explains everything from climate change to price wars to why your office kitchen is always dirty. ...

Have you ever wondered why gas stations on the same corner charge similar prices? Or why countries engage in arms races even though both would be better off spending less on weapons? Or why you and your friends can’t decide where to eat, even though everyone wants to go somewhere? These situations all involve strategic decision-making-and that’s exactly what game theory studies. What is Game Theory? Game theory is the mathematical study of strategic interactions. It’s a framework for understanding situations where your best choice depends on what others choose, and their best choice depends on what you choose. ...

In poker, every dollar you win comes from someone else’s loss. In chess, one player wins and one loses. In tennis, your point is your opponent’s lost opportunity. These are zero-sum games-pure competition where one player’s gain equals another’s loss. Understanding zero-sum games changes how you compete, negotiate, and think about conflict. Let’s explore this fundamental concept. What is a Zero-Sum Game? A zero-sum game is a situation where the total gains and losses always sum to zero. Whatever one player wins, another must lose. ...

When most people hear the word “game,” they think of fun activities like chess, poker, or video games. But in mathematics, a “game” has a much broader and more precise meaning. Game theory studies strategic situations where the outcome depends not just on your choices, but on the choices of others too. What Makes Something a “Game”? In game theory, a game is any situation where: Multiple decision-makers (called “players”) interact Each player has choices (called “strategies”) they can make Each combination of choices leads to an outcome with specific rewards or costs (called “payoffs”) Players care about these outcomes and try to make rational decisions The beauty of this definition is that it applies to far more than board games. Business competition, political negotiations, evolutionary biology, and even social dilemmas are all “games” in the mathematical sense. ...

Western storytelling has a formula: introduce a hero, give them a problem, make it worse, then resolve it through struggle. Conflict is everything. Heroes need villains. Protagonists need obstacles. Stories need tension. But what if there’s another way? What if you could tell a compelling story with zero conflict, no antagonist, and no struggle-and still keep your audience completely engaged? Welcome to kishotenketsu (起承転結), the East Asian narrative structure that’s been creating beautiful stories for over a thousand years without relying on conflict at all. ...

If you want to master game theory, you need to master payoff matrices. They’re the single most important tool for analyzing two-player games, and once you understand them, you’ll see strategic situations everywhere. A payoff matrix is simply a table that shows every possible outcome of a game and what each player gets in each scenario. But this simple visualization unlocks powerful insights about human behavior, business strategy, and why rational people sometimes make seemingly irrational choices. ...

Here’s one of the most unsettling discoveries in mathematics: perfectly rational players, each acting in their own self-interest, can all end up worse off than if they had acted irrationally. This isn’t a flaw in game theory-it’s a feature of reality that game theory reveals. This paradox explains traffic jams, arms races, overfishing, climate change negotiations, and why businesses sometimes engage in destructive price wars. Understanding it will change how you see human cooperation (and its failures). ...

In 1913, French agricultural engineer Maximilien Ringelmann conducted a simple experiment: he asked people to pull on a rope, both alone and in groups, and measured their effort. The task was straightforward. Pull as hard as you can. That’s it. When pulling alone, participants gave it their all. But when Ringelmann added more people to the rope, something strange happened. Individual effort decreased. Not a little. A lot. The Numbers Don’t Lie Ringelmann’s findings were shocking: ...