Game Theory
Every incentive lives inside a game. Find the game and the strategy follows.
What game is being played — and what is the equilibrium?
Canonical thinkers
- John Nash
- Thomas Schelling
- Robert Axelrod
- John von Neumann
Seed concepts
- prisoner's dilemma
- stag hunt
- chicken
- public goods
- common pool
- nash
- tit for tat
- evolutionarily stable
- signaling
- principal-agent
- principal agent
- moral hazard
- adverse selection
- game theory
- coordination
Underlined seeds link to their full glossary entry. Plain seeds are pending a definition page.
Typed connections
Full graph →How this layer reinforces, counteracts, or depends on the rest of the system.
- Reinforces·LayerThis layer reinforces Systems Thinking
Strategic equilibria become feedback loops once you let the game iterate; both predict structural lock-in.
- Depends on·LayerAI & Alignment depends on this layer
Alignment is a multi-agent game; AI safety reduces to mechanism design once capability is high enough.
- Instance of·LayerNegotiation is an instance of this layer
Negotiation is the most-played repeated game in human life — Fisher & Ury is applied Schelling.
- Explains·HBEThis layer explains Principal-Agent Problem
Principal–agent is a textbook asymmetric-information game; the solution space is mechanism design.
Elements in this layer
21 HBEsAsymmetric information attracts the worst counterparties.
Game theory adjusted for how humans actually play — including fairness, reciprocity, and limited reasoning.
Individually rational choices that produce a collectively bad outcome.
Employers screen by school name, rewarding admission rather than developed skill.
Coordinated action that produces outcomes unavailable to individual actors.
Working together has a cost that scales with the number of people.
Outcomes depend on aligning choices, not on who 'wins.'
Signals whose value depends on being expensive to fake.
People consume shared resources without contributing.
Decisions depend on what other strategic actors will do.
Insulation from risk changes the risks people take.
A state where no player benefits from changing strategy unilaterally.
Lower headline cost masks coordination failures, IP leakage, and quality erosion.
Agents act in their own interest, not the principal's.
Individual rationality produces collective irrationality.
Players choose how much to contribute to a shared pot; selfish theory predicts zero, real humans contribute, and punishment of free-riders sustains cooperation.
A behavioral relaxation of Nash: players choose better strategies more often, but not always — errors are smooth, not binary.
The default coordination outcome people converge on without communicating.
Costly actions that credibly communicate hard-to-observe traits.
Coordination problem where cooperation pays more but defection is safer.
Start cooperative; copy your counterpart's last move thereafter.