The Video Game Industry and Its Prisoner's Dilemma

The Video Game Industry and its Prisoner’s Dilemma

1. Introduction

Often times, people witnessing the actions of others will ask a very basic question “Why did he (or she) do that?” This question is one that is repeated almost every second, in every language, at almost every second by some individual perplexed by the actions of others. The pursuit of understanding human behavior has led to the creation of a branch of the social sciences, known as Game Theory. Game Theory is “the study of mathematical models of conflict and cooperation between intelligent rational decision-makers.^[1]” Game Theory allows observers to predict how rational individuals will behave when dealing with certain situations, according to mathematical outcomes.  Levin states “there are two main branches of game theory: cooperative and non-cooperative game theory. Non-cooperative game theory deals largely with how intelligent individuals interact with one another in an effort to achieve their own goals.”^[2] Prisoner’s Dilemma, a type of non-cooperative game, is of particular interest due to its uses in real life situations. One instance where Prisoner’s Dilemma is relevant is when consumers decide between buying a PS4 and an XBOX One. This paper will attempt to take an analytical study into a version of the Prisoner’s Dilemma, known as the Two-Person, One-Shot Prisoner’s Dilemma game. Furthermore, the paper will connect Video Game Console purchases to the Two-Person, One-Shot Prisoner’s Dilemma game.

1. The Two-Person, One-Shot Prisoner’s Dilemma Game

One of the varieties of the Prisoner’s Dilemma (PD Game) is known as the Two-Person, One

Shot PD game. As the name implies, it involves two players who each have two choices: cooperation and defection. Player 1 and 2 have one “shot” (chance) to make a decision, they cannot communicate with the other player before they have made a choice. After they have made their decision, the consequences of their choice, in conjunction with the choice of the other player, give each player a result of some sort. The most basic version of the Two-Person, One-Shot PD game, involves two criminals who are brought in for questioning because the police believe that they have collaborated on a crime. Each Criminal is interrogated separately, and both are given options of a plea deal, if they confess and testify against the other criminal, then they will be given a shorter sentence. As such, each Player in the original dilemma has the option of cooperating (staying mum) or defecting (confessing and testifying against the other criminal). If one criminal chooses to defect, while the other chooses to cooperate – the player who chooses to defect receives the most optimal result, the least amount of jail time possible for their crime. However, the player who chose to cooperate will receive the most amount of jail time possible. If both players choose to defect, by the confessing to the crime, they will receive a large amount of jail time, as both have confessed. Finally, if both players choose to cooperate by not confessing, they will receive a jail sentence, but one that is not as long if both players had chosen to defect. Their combined choices result in the game matrix below, where the most optimal result is reflected by the highest number: