Paul Raeburn - The Game Theorist’s Guide to Parenting: How the Science of Strategic Thinking Can Help You Deal with the Toughest Negotiators You Know—Your Kids

The author and publisher have provided this e-book to you for your personal use only. You may not make this e-book publicly available in any way. Copyright infringement is against the law. If you believe the copy of this e-book you are reading infringes on the authors copyright, please notify the publisher at: us.macmillanusa.com/piracy.

To our favorite game theoristsour parents and our kids

In 2005, Takashi Hashiyama, the president of the Maspro Denkoh Corporation, a Japanese electronics company, laid out the terms for what might be the oddest and most expensive childrens game ever played.

He wanted to auction off the companys $20 million art collection, which included works by Czanne, Picasso, and van Gogh. But he couldnt decide which auction house would do the best jobChristies or Sothebys. After some thought, Hashiyama announced that he had devised a rather unconventional way to settle the matter: The companies would play Rock, Paper, Scissors. And the winner would sell the art.

Two representatives from each of the companies were called to a Maspro conference room and asked to sit down at a long table facing one another. Each team was given a piece of paper and asked to write one thing: the Japanese word for rock, paper, or scissors. Christies picked scissors. It was the winner, beating Sothebys paper.

Most of us would assume that was fair. It was a game of chance; Christies got lucky. But it wasnt simply luck. Christies had a strategy. Before the showdown, a Christies executive consulted two experts on the subtleties of the game: his eleven-year-old twins. Everybody knows you always start with scissors, they told him. Rock is way too obvious, and scissors beats paper. After the contest, Sothebys acknowledged that it had not devised a strategy. It lost several million dollars in commissions as a result.

Rock, Paper, Scissors is a classic example in the study of game theory. Originally developed as a part of mathematics, game theory is the study of how people play games, interact, and negotiate. It deals with strategic thinking in situations where one persons choice of action will affect what the other does in response. Solitaire has nothing to do with game theory: its just you and the deck of cards. Chess is quite different. Opening with pawn to e4 immediately affects the strategy of your opponent, whose move will, in turn, affect your next move. Those are the kinds of situations that fascinate game theorists.

Game theory was devised by economists and mathematicians, but researchers quickly realized that it had applications far beyond economics. It has become the foundation for industrial-strength negotiations, and it is used by presidents and prime ministers, celebrities and CEOs.

* * *

The roots of game theory extend deep into the past, long before its establishment as a science in the midtwentieth century. One famous example of a game-theory strategy concerns the military figure Kong Ming (also known as Zhuge Liang), who was forced to defend himself against overwhelming odds in a battle in Yangping, China in 149 B.C. Its a twist on the familiar story of the Trojan horse. Both stories involve deceptionbut in different ways. In the tale of the Trojan horse, the soldiers came out of hiding. In the case of Kong Mings defense, the soldiers went into hiding.

Authorities disagree over whether this is a historical fact or part of Chinese military lore, but the story is too good for us to leave out. Kong Ming was engaged with an enemy, Suma-I, whose forces vastly outnumbered his. Furthermore, Suma-Is warriors had blocked all potential avenues of retreat. Considering the odds, Kong Ming faced certain defeat. He was out of options. Retreating was impossible. Staying to fight was suicide.

At this point, Kong Ming had a brilliant idea. As Suma-I crept forward with his forces, preparing to attack, he stopped. He couldnt believe what he was seeing. Kong Ming had opened the gates to the city of Yangpingand there were no soldiers in sight. (Kong Ming had directed all the guards to hide.) Suma-I saw before him an unguarded city. A solitary figure sat in a tower playing a lute. Suma-I could not understand why Kong Ming would leave the city vulnerable like this. He concluded that it must be a trap, and quickly retreated. Kong Ming had won the battle without throwing a punch. It was a triumph.

The point of this story is that Kong Ming and Suma-I each had to anticipate what the other would think. If Suma-I hadnt stopped to think about why Kong Ming opened the gates, he would have overrun the defenseless city. Kong Mings actions would have been recorded as a military blunder, and we wouldnt be talking about him now. But Suma-I did stop to think. And Kong Ming knew that he would. He knew exactly what Suma-I would think, and he was right. This is why Kong Ming emerges from this story as a military genius.

Game theory did not become a true sensation, however, until 1944, when its principles were spelled out in detail by the brilliant economist, physicist, mathematician, and computer scientist John von Neumann and his colleague Oskar Morgenstern. That was the year they published their groundbreaking book Theory of Games and Economic Behavior , which launched game theory as a new sciencethe science of strategic thinking. Some authorities think von Neumann, an acknowledged genius, was mainly responsible for the breakthrough, and that Morgensterns role was to goad von Neumann into applying himself to this new field. In any case, their names are now linked as the co-developers of the theory.

One of the most important developments since then came in the early 1950s with the work of John Nash, another brilliant Princeton mathematician whose work on game theory inspired the book and film A Beautiful Mind . He published several scientific papers that took von Neumanns and Morgensterns work much further, and he doubtless would have published many more had he not been diagnosed with schizophrenia a few years later. For a time he left the field, but he ultimately received treatment for his illness and was able to resume his career in the 1990s. In 1994, he was awarded the Nobel Memorial Prize in economics for his work on what are now called Nash equilibria , work that explains a lot about human behavior, including how people acting in their own best interest dont always arrive at the best solution. That makes him one of at least eleven game theorists who have won Nobels for their work. Unfortunately, tragedy struck Nash a second time in 2015. He and his wife were killed in a car accident on the New Jersey Turnpike while we were working on this book.

In the years since von Neumann and Nash, game theory has been applied to political science, public health, psychology, and even studies in animal behavior. (Spiders and fish, it turns out, can be excellent game theorists, although they cant be said to think at all. Evolution has equipped them with wonderful strategies that they pursue without knowing why.)

Only recently, however, have game theorists turned their attention to one of the most challenging strategic problems of allraising children. Its now clear we can put game theory to work in our families. Game theory can help us persuade kids to do their homework, brush their teeth, get out of bed in the morning, and crawl back into it at night. And if we explain the rules clearly to our kids, we can help them get along better with us and with each otherand we can do it without administering any punishment.