Cooperation

Cooperative Game Theory: How to Split the Pie Fairly Three friends start a company together. After five years of hard work, they sell it for $10 million. How should they split the money? Equal shares? ($3.33M each) Proportional to hours worked? Based on who contributed what? What if one person brought the key technology, another the business connections, and the third the execution? Cooperative game theory provides mathematical answers to these questions. ...

Repeated Games: How Cooperation Emerges from Self-Interest In the Prisoner’s Dilemma, rational players defect. In the Tragedy of the Commons, rational actors destroy shared resources. One-shot game theory seems to paint a bleak picture: selfishness always wins. But real life isn’t a series of one-shot games. We interact with the same people, companies, and countries repeatedly. And this changes everything. Welcome to repeated games — where cooperation emerges not from altruism, but from enlightened self-interest. ...