The Prisoners' Dilemma

By Jodi Beggs, About.com Guide

The prisoners' dilemma is a very popular example of a two-person game of strategic interaction, and it's a common introductory example in many game theory textbooks. The logic of the game is simple:

• The two players in the game have been accused of a crime and have been placed in separate rooms so that they cannot communicate with one another. (In other words, they can't collude or commit to cooperating.)
• Each player is asked independently whether he is going to confess to the crime or remain silent.
• Because each of the two players has two possible options (strategies), there are four possible outcomes to the game.
• If both players confess, they each get sent to jail, but for fewer years than if one of the players got ratted out by the other.
• If one player confesses and the other remains silent, the silent player gets punished severely while the player who confessed gets to go free.
• If both players remain silent, they each get a punishment that is less severe than if they both confess.

In the game itself, punishments (and rewards, where relevant) are represented by numbers. Positive numbers represent good outcomes, negative numbers represent bad outcomes, and one outcome is better than another if the number associated with it is greater. (Be careful, however, of how this works for negative numbers, since -5, for example, is greater than -20!)

In the table above, the first number in each box refers to the outcome for player 1 and the second number represents the outcome for player 2. These numbers represent just one of many sets of numbers that are consistent with the prisoners' dilemma setup.

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• The Prisoners' Dilemma
• Analyzing the Players' Options
• Nash Equilibrium
• Efficiency of the Nash Equilibrium

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