Link: http://www.fastcompany.com/magazine/91/debunk.html?page=0%2C0

During lecture we spent a lot time talking about different types of game theory. But are there really any situations in business that these payoffs really apply to. Not many people deal with two prisoners confessing or a dove and a hawk fighting over food. Sure there is a general way for all the topics to relate back to these types of games, but it’s not like people are really thinking about it this way. Plus in business, it is not like people are looking for a Nash Equilibrium, they just look to do what is best for their company.

The article discusses the panel that they held and how even a group of thirty game theorists could not actually come up with a real world that DIRECTLY applied to game theory. Sure there are plenty of real world examples that are metaphors in business, such as two divorce lawyers trying to each get their client what they want which could very much be like the Hawk-Dove Game. But even with these metaphors, they are fairly hazy parallels. Even if the parallels do exist fairly plainly, people are not applying game theory to figure out how they should act. They are acting on things that they know work based on the learning curve that each person has already established. Isn’t that the difference between a good and bad lawyer.

I think that the fact that some of the most respected game theorists could not come up with a real world application to game theory is enough evidence to say one may not exist. Although I do think that the parallels are evident as well as the theories associated with it are put into practice. Even though the business world really does not think in Nash Equilibriums or about the Prisoner’s Dilemma Game in context, these all set the learning curves and the rules which have come to rule the business world as it is today.