I see the Nash equilibrium as rationally justified in a limit-like sort of way. I see it as what you get if you get arbitrarily close to perfect rationality. Having a good enough model of another’s preferences is something you can actually achieve or almost achieve, but you can’t really have a good enough grasp of your opponent’s source code to acausally coerce him into cooperating with you unless you really have God-like knowledge (or maybe if you are in a very particular situation such as something involving AI and literal source codes). In proportion as a mere mortal becomes more and more smart, he becomes more and more able to get the best deal by having a better grasp on the Nashian game-theoretic intricacies of a given situation, but he won’t become any more able to acausally trade. It’s all or nothing. I think your whole line of reasoning is a bit like objecting to calculus on the grounds that instantaneous change is an oxymoron (as people did when calculus still rested on less rigorous foundations). Non-Nashian game theory is technically correct, but less useful, just like pointing out to Leibniz that “(x^2+0-x^2)/(x+0-x) = undefined” or whatever
I see the Nash equilibrium as rationally justified in a limit-like sort of way. I see it as what you get if you get arbitrarily close to perfect rationality. Having a good enough model of another’s preferences is something you can actually achieve or almost achieve, but you can’t really have a good enough grasp of your opponent’s source code to acausally coerce him into cooperating with you unless you really have God-like knowledge (or maybe if you are in a very particular situation such as something involving AI and literal source codes). In proportion as a mere mortal becomes more and more smart, he becomes more and more able to get the best deal by having a better grasp on the Nashian game-theoretic intricacies of a given situation, but he won’t become any more able to acausally trade. It’s all or nothing. I think your whole line of reasoning is a bit like objecting to calculus on the grounds that instantaneous change is an oxymoron (as people did when calculus still rested on less rigorous foundations). Non-Nashian game theory is technically correct, but less useful, just like pointing out to Leibniz that “(x^2+0-x^2)/(x+0-x) = undefined” or whatever