The Prisoner’s Dilemma Game Theory

Author Arun Nawani

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Introduction

Joker and Bane are two of the most notorious criminals in Gotham city and have somehow always succeeded in evading the Gotham Police Department.

The Gotham District Attorney, Harvey Dent, finally decided to cooperate with city hero Batman to apprehend the two criminals.

After weeks of struggle, Batman finally managed to get the two criminals into police custody. But the problem was neither of the two was willing to cooperate in the interrogation. The police department made them an intriguing offer in order to conduct their investigation.

Problem Overview

The police made their offer to both the criminals to proceed with the investigation. The police told both of them that -

“You are going to serve 2 years of prison. However, if you decided to confess and the other person didn’t, you would be set free, and the other person would serve 5 years of punishment. But if both of you confessed, then you’re both going to serve 3 years in prison.”

Now it’s up to the criminals to make their decision.

Analyzing the Possible Scenarios

Before the analysis, it’s important to know there’s no trust whatsoever between the two criminals. They would always choose what’s best for them before making a decision.

	Bane Confesses	Bane Denies
Joker Confesses	3 years of prison to both	Joker is free. Bane serves 5 years in prison.
Joker Denies	Bane is free. Joker serves 5 years in prison.	2 years of prison to both

As we can see, both the criminals were in a severe dilemma. But after analyzing the scenarios well, they realised they were always better off confessing their crimes.

Let’s take the point of view of either of the criminals. Suppose Joker were to make his mind up. He made the following two cases:-

Bane denies: If Bane denies, then Joker could be set free if he confesses his crime.

Bane confesses: If Bane confesses, then Joker has to confess. Otherwise, he would serve 5 years in prison.

We deduce that both the criminals would always benefit if they were to confess regardless of what decision the other criminal makes.

Real-life Scenarios of Prisoner’s Dilemma Game

The Prisoner’s dilemma game theory finds a number of real-life use cases as well. We know how companies gather huge personal data from their users every day, monitoring their usage to serve their commercial purposes. Although they know it’s not very ethical but an unavoidable way to sustain in this data-driven market. Even if they decide to not gather personal data from their users, their competitors will continue to do so. So it’s best for them to embrace this new reality if they wish to survive and thrive in today’s world.

Key Takeaways

We saw how prevalent the prisoner’s dilemma problem is even in the real world. How we can come up with different scenarios and make a sound decision in a critical situation.

The prisoner’s dilemma game theory tells us that two rational people may not cooperate even if it mutually benefits both parties.

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