Nod. I was in the process of noticing that the math didn’t check out here but got distracted and then YOLO posted it.
I think the implied situation I was half remembering when I wrote it was something like a business deal, where you both have to invest, and also the payoff isn’t guaranteed. I think either “Stag hunt without guaranteed payoff” or “Prisoner Dilemma” would each be a reasonable example. Agreed that in the current one, defecting is just… stupid.
I updated the OP to use your suggestion, which seems like a nicer, simpler version.
Cheers! I think it’s interesting to consider what makes this situation fit the stag hunt vs. PD framework.
Like, say the situation is:
Alice and Bob can each put in $1 million. If they both do, they get a 50% chance of getting their money back, plus an extra $1 million (for a total of $2 million each), and a 50% chance of getting their money back with no bonus.
However, whoever puts their money in first is also at risk of the other person absconding with their $1 million, so that the second person has a 100% chance of getting $2 million total (instead of a 50% chance).
In this case, it is advantageous to Alice and Bob to have enough trust to make them willing to take the deal.
Nod. I was in the process of noticing that the math didn’t check out here but got distracted and then YOLO posted it.
I think the implied situation I was half remembering when I wrote it was something like a business deal, where you both have to invest, and also the payoff isn’t guaranteed. I think either “Stag hunt without guaranteed payoff” or “Prisoner Dilemma” would each be a reasonable example. Agreed that in the current one, defecting is just… stupid.
I updated the OP to use your suggestion, which seems like a nicer, simpler version.
Cheers! I think it’s interesting to consider what makes this situation fit the stag hunt vs. PD framework.
Like, say the situation is:
Alice and Bob can each put in $1 million. If they both do, they get a 50% chance of getting their money back, plus an extra $1 million (for a total of $2 million each), and a 50% chance of getting their money back with no bonus.
However, whoever puts their money in first is also at risk of the other person absconding with their $1 million, so that the second person has a 100% chance of getting $2 million total (instead of a 50% chance).
In this case, it is advantageous to Alice and Bob to have enough trust to make them willing to take the deal.