The prisoner’s dilemma and Max Weber

The Prisoner’s Dilemma is probably the most famous piece of a field called game theory.

This has nothing to do with chess, I promise.

Game theory brings mathematical and economic principles to bear on the decisions of people (or companies or countries) engaged in competitive/cooperative scenarios. Wikipedia has a really terrific explanation of game theory and there you’ll also find a description of the Prisoner’s Dilemma, which at its heart presents each prisoner with a choice: Stay silent (and do some time) or rat out your partner (and do less time, while your buddy does more).

It appears to be in each prisoner’s best personal interest to squawk. However, as the complexity of the game ratchets up – the so-called Iterated Prisoner’s Dilemma, when it’s not a one-time choice but a series of choices, as you would expect in for example capitalist competition –  it turns out that the obvious solution is not the solution that leads to the best overall outcome. Cooperation (nobody squawks) is the strategy that pays off best for both parties in the long term.

What brings this to my attention or my blog is the section on morality. Which makes the argument that the moral choice (cooperating) is also the one mathematically or economically most consistent with self-interest. And this seems pretty consistent with my point about the Weber Thesis and capitalism without a compass. Essentially some very smart people argue that the way to make the most money is to treat people decently and behave morally.

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