Game Theory

=The Approach=

=Models=

the Prisoner's Dilemma
The Prisoner's Dilemma is the most basic and the simplest setup in Game Theory. It consists of two players that each have two options to act. The two players are accomplices in a crime and are taken prisoners by the police, Both are offered a deal: if one betrays the other, he can get away serving only a year in prison, while the other gets 4 years. If they both stay silent and thus cooperate, they get away with 2 years each. If, however, they both betray each other, they serve 3 years each. Since, none of the two knows how the other is going to act, it is commonly assumed that they will both opt to betray each other.