http://www.usatoday.com/sports/2008-02-27-drugs-hearing_N.htm

The prisoner’s dilemma is a classic game theory situation, as it can be applied to a plethora of varied cases. One such case involves the delicate art of athletic cheating. Whether the setting is baseball or mountain biking, each athlete’s dominant strategy is to use steroids. If one athlete uses performance-enhancing steroids while another does not, then the cheater gains a huge competitive advantage over the non-cheater. Thus, many athletes are driven to cheat in order to gain advantage, whether it is to break records or win more games.

The end result, which does not maximize social welfare, is that most athletes use drugs and do not gain any competitive advantage over one another. Therefore, it may be better, especially in terms of cost (drugs are expensive) if all athletes did not use steroids, because they would have saved much money this way. This then maximizes social welfare. Plus, there are additional costs of using steroids, including potential future health degradation and a huge risk of damaging the athlete reputation if caught. Of course, athletes cannot trust each other to be honest, and thus, they cannot arrive and the result where there is no drug use whatsoever.

Additionally, the demand for steroids creates an arms race of sorts between the steroid makers and the sports regulation authorities. This is another prisoner’s dilemma situation. Both the makers and the authorities must keep building better drugs/drug detectors to keep up with each other. If the makers improve their product and the authorities do not, then the makers’ product will have a competitive advantage, and vice versa. Thus, both groups are forced to spend large portions of time and large amounts of cash in their quest for constant innovation.

Thus, game theory offers some insight into why athletic cheating is so rampant in today’s world of sports.