The Traveler's Dilemma

Ambassador Ann | March 22, 2012

Jeff F(II): Today I asked the Lawline team to work through an exercise known as the traveler's dilemma- a variant of the popular game theory thought exercise, the prisoner's dilemma.

In pairs, everyone was asked to choose between either $2 or $3, knowing that if both chose the same amount, both would receive that amount.  However, if the amounts differed, the person choosing $2 would be rewarded with $4 and the person choosing $3 would be reduced to $1.  The paradox of the exercise is that the most rational decision (choosing $2 since it always yields the highest individual result) does not actually yield the highest values.

Watching the game play out, what was most striking wasn't the decisions people were making but rather why they were being made.  A sense of altruism and what worked best for the pair was evident and this led some pairs both choose $3, the optimal outcome.  This is a great example of being driven to find a better way.  Though some chose $3 because it may have seemed to be the higher yielding value, some chose it simply because they realized that you don't always have to be rational, and working together and trusting in one another, a better overall result can be achieved.

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