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The statement "Game theory is inevitable. Because game theory is just math, the study of how independent actors react to incentives." implies that the "actors"

by rmah 10mo ago

The statement "Game theory is inevitable. Because game theory is just math, the study of how independent actors react to incentives." implies that the "actors" are humans. But that's not what game theory assumes. Game theory just provides a mathematical framework to analyze outcomes of decisions when parts of the system have different goals. Game theory does not claim to predict human behavior (humans make mistakes, are driven by emotion and often have goals outside the "game" in question). Thus game theory is NOT inevitable.

hyperadvanced 10mo ago
Yes, game theory is not a predictive model but an explanatory/general one. Additionally not everything is a game, as in statistics, not everything has a probability curve. They can be applied speculatively to great effect, but they are ultimately abstract models.
- nostrademons 10mo ago
  You can use it for either predictive or explanatory purposes. In the early ('00s) years of Google it was common to diagram out the incentives of all the market participants; this led to such innovations like the use of the second-price VCG auction [1] for ad sales that now make over a third of a trillion dollars per year. [1] https://en.wikipedia.org/wiki/Vickrey%E2%80%93Clarke%E2%80%93Groves_auction https://en.wikipedia.org/wiki/Vickrey%E2%80%93Clarke%E2%80%9...
  - nickff 10mo ago
    Google has now (mostly?) transitioned to using first-price, and more complicated (opaque) auction-style pricing for many of its advertising products. https://blog.google/products/admanager/simplifying-programmatic-first-price-auctions-google-ad-manager/ https://blog.google/products/admanager/simplifying-programma...
    - nostrademons 10mo ago
      > It’s important to note that our move to a single unified first price auction only impacts display and video inventory sold via Ad Manager. This change will have no impact on auctions for ads on Google Search, AdSense for Search, YouTube, and other Google properties, and advertisers using Google Ads or Display & Video 360 do not need to take any action.
  - hyperadvanced 10mo ago
    This is a good point, and I’m willing to concede that I may be wrong here, that predictive power can be gained from (possibly mis-) applications of abstractions onto a real space, which is what one of the real reasons to favor abstract thinking in business in the first place.
CGMthrowaway 10mo ago
A practical formula: 1) Identify coordination failures that lock us into bad equilibria, e.g. it's impossible to defect from the online ads model without losing access to a valuable social graph 2) Look for leverage that rewrites the payoffs for a coalition rather than for one individual: right-to-repair laws, open protocols, interoperable standards, fiduciary duty, reputation systems, etc. 3) Accept that heroic non-participation is not enough. You must engineer a new Schelling point[1] that makes a better alternative the obvious move for a self-interested majority TLDR, think in terms of the algebra of incentives, not in terms of squeaky wheelism and moral exhortation [1]https://en.wikipedia.org/wiki/Focal_point_(game_theory) https://en.wikipedia.org/wiki/Focal_point_(game_theory)
- alwa 10mo ago
  As a recent example, Jon Haidt seems to have used this kind of tactic to pull off a coup with the whole kids/smartphones/social media thing [0]. Everybody knew social media tech was corrosive and soul-rotting, but nobody could move individually to stand up against its “inevitability.” Individual families felt like, if they took away or postponed their kids’ phones, their kid would be left out and ostracized—which was probably true as long as all the other kids had them. And if a group of families or a school wanted to coordinate on something different, they’d have to 1) be ok with seeming “backwards,” and 2) squabble about how specifically to operationalize the idea. Haidt framed it as “four simple norms,” which offered specific new Schelling points for families to use as concrete alternatives to “it’s inevitable.” And in shockingly little time, it’s at the point where 26 states have enshrined the ideas into legislation [1]. [0] https://www.cnbc.com/2025/02/19/jonathan-haidt-on-smartphone-free-childhood-key-is-enforcing-4-norms.html https://www.cnbc.com/2025/02/19/jonathan-haidt-on-smartphone... [1] https://apnews.com/article/cellphones-phones-school-ban-states-c6a54feb9d2661e04989b7cdd5b2821b https://apnews.com/article/cellphones-phones-school-ban-stat...
  - aanet 10mo ago
    Great. Now let's do the same to AI slop, what many (including Haidt and co., Australia, etc) have done to lessen kids social media usage. FWIW, I gave up on FB/Twttr crap a while ago... Unfortunately, I'm still stuck with WhatsApp and LI (both big blights) for now. YMMV
nostrademons 10mo ago
Game theory is still inevitable. Its application to humans may be non-obvious. In particular, the "games" can operate on the level of non-human actors like genes, or memes, or dollars. Several fields generate much more accurate conclusions when you detach yourself from an anthrocentric viewpoint, eg. evolutionary biology was revolutionized by the idea of genes as selfish actors rather than humans trying to pass along their genes; in particular, it explains such concepts as death, sexual selection, and viruses. Capitalism and bureaucracy both make a lot more sense when you give up the idea of them existing for human betterment and instead take the perspective of them existing simply for the purpose of existing (i.e. those organizations that survive are, well, those organizations that survive; there is nothing morally good or bad about them, but the filter that they passed is simply that they did not go bankrupt or get disbanded). But underneath those, game theory is still fundamental. You can use it to analyze the incentives and selection pressures on the system, whether they are at sub-human (eg. viral, genetic, molecular), human, or super-human (memetic, capitalist, organizational, bureaucratic, or civilizational) scales.

by rmah 10mo ago

hyperadvanced 10mo ago

Yes, game theory is not a predictive model but an explanatory/general one. Additionally not everything is a game, as in statistics, not everything has a probability curve. They can be applied speculatively to great effect, but they are ultimately abstract models.

nostrademons 10mo ago
You can use it for either predictive or explanatory purposes. In the early ('00s) years of Google it was common to diagram out the incentives of all the market participants; this led to such innovations like the use of the second-price VCG auction [1] for ad sales that now make over a third of a trillion dollars per year. [1] https://en.wikipedia.org/wiki/Vickrey%E2%80%93Clarke%E2%80%93Groves_auction https://en.wikipedia.org/wiki/Vickrey%E2%80%93Clarke%E2%80%9...
- nickff 10mo ago
  Google has now (mostly?) transitioned to using first-price, and more complicated (opaque) auction-style pricing for many of its advertising products. https://blog.google/products/admanager/simplifying-programmatic-first-price-auctions-google-ad-manager/ https://blog.google/products/admanager/simplifying-programma...
  - nostrademons 10mo ago
    > It’s important to note that our move to a single unified first price auction only impacts display and video inventory sold via Ad Manager. This change will have no impact on auctions for ads on Google Search, AdSense for Search, YouTube, and other Google properties, and advertisers using Google Ads or Display & Video 360 do not need to take any action.
- hyperadvanced 10mo ago
  This is a good point, and I’m willing to concede that I may be wrong here, that predictive power can be gained from (possibly mis-) applications of abstractions onto a real space, which is what one of the real reasons to favor abstract thinking in business in the first place.

CGMthrowaway 10mo ago

A practical formula: 1) Identify coordination failures that lock us into bad equilibria, e.g. it's impossible to defect from the online ads model without losing access to a valuable social graph 2) Look for leverage that rewrites the payoffs for a coalition rather than for one individual: right-to-repair laws, open protocols, interoperable standards, fiduciary duty, reputation systems, etc. 3) Accept that heroic non-participation is not enough. You must engineer a new Schelling point[1] that makes a better alternative the obvious move for a self-interested majority TLDR, think in terms of the algebra of incentives, not in terms of squeaky wheelism and moral exhortation [1]https://en.wikipedia.org/wiki/Focal_point_(game_theory) https://en.wikipedia.org/wiki/Focal_point_(game_theory)

alwa 10mo ago
As a recent example, Jon Haidt seems to have used this kind of tactic to pull off a coup with the whole kids/smartphones/social media thing [0]. Everybody knew social media tech was corrosive and soul-rotting, but nobody could move individually to stand up against its “inevitability.” Individual families felt like, if they took away or postponed their kids’ phones, their kid would be left out and ostracized—which was probably true as long as all the other kids had them. And if a group of families or a school wanted to coordinate on something different, they’d have to 1) be ok with seeming “backwards,” and 2) squabble about how specifically to operationalize the idea. Haidt framed it as “four simple norms,” which offered specific new Schelling points for families to use as concrete alternatives to “it’s inevitable.” And in shockingly little time, it’s at the point where 26 states have enshrined the ideas into legislation [1]. [0] https://www.cnbc.com/2025/02/19/jonathan-haidt-on-smartphone-free-childhood-key-is-enforcing-4-norms.html https://www.cnbc.com/2025/02/19/jonathan-haidt-on-smartphone... [1] https://apnews.com/article/cellphones-phones-school-ban-states-c6a54feb9d2661e04989b7cdd5b2821b https://apnews.com/article/cellphones-phones-school-ban-stat...
- aanet 10mo ago
  Great. Now let's do the same to AI slop, what many (including Haidt and co., Australia, etc) have done to lessen kids social media usage. FWIW, I gave up on FB/Twttr crap a while ago... Unfortunately, I'm still stuck with WhatsApp and LI (both big blights) for now. YMMV

nostrademons 10mo ago

Game theory is still inevitable. Its application to humans may be non-obvious. In particular, the "games" can operate on the level of non-human actors like genes, or memes, or dollars. Several fields generate much more accurate conclusions when you detach yourself from an anthrocentric viewpoint, eg. evolutionary biology was revolutionized by the idea of genes as selfish actors rather than humans trying to pass along their genes; in particular, it explains such concepts as death, sexual selection, and viruses. Capitalism and bureaucracy both make a lot more sense when you give up the idea of them existing for human betterment and instead take the perspective of them existing simply for the purpose of existing (i.e. those organizations that survive are, well, those organizations that survive; there is nothing morally good or bad about them, but the filter that they passed is simply that they did not go bankrupt or get disbanded). But underneath those, game theory is still fundamental. You can use it to analyze the incentives and selection pressures on the system, whether they are at sub-human (eg. viral, genetic, molecular), human, or super-human (memetic, capitalist, organizational, bureaucratic, or civilizational) scales.