Emerson Niou - Strategy and Politics: An Introduction to Game Theory

Strategy and Politics:An Introduction to Game Theory is designed to introduce students to the application of game theory for modeling political processes. This accessible text examines the phenomena that power political machinerieselections, legislative and committee processes, and international conflictand answers fundamental questions about their nature and function in a clear, accessible manner.

Included at the end of each chapter is a set of exercises designed to allow students to practice the construction and analysis of political models. Although the text assumes only an elementary-level training in algebra, students who complete a course around this text will be equipped to read nearly all of the professional literature that makes use of game theoretic analysis.

Emerson M.S. Niou is Professor of Political Science at Duke University.

Peter C. Ordeshook is Professor of Political Science at California Institute of Technology.

Strategy and Politics

An Introduction to Game Theory

First published 2015

by Routledge

711 Third Avenue, New York, NY 10017

and by Routledge

2 Park Square, Milton Park, Abingdon, Oxon, OX14 4RN

Routledge is an imprint of the Taylor & Francis Group, an informa business

2015 Taylor & Francis

The right of Emerson M.S. Niou and Peter C. Ordeshook to be identified as authors of this work has been asserted by them in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988.

All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers.

Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe.

Library of Congress Cataloging-in-Publication Data

Niou, Emerson M. S.
Strategy and politics : an introduction to game theory / Emerson Niou, Peter C. Ordeshook.
pages cm
1.Game theory.2.Political scienceMathematical models.3.Political scienceMethodologyI.Ordeshook, Peter C.,
1942 II. Title.
JA72.5.N56 2015
320.015193dc232014034874

ISBN: 978-1-138-01948-5 (hbk)

ISBN: 978-0-415-99542-9 (pbk)

ISBN: 978-1-315-73515-3 (ebk)

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Over twenty five hundred years ago, the Chinese scholar Sun Tzu, in The Art of War, proposed a codification of the general strategic character of armed conflict and, in the process, offered practical advice for securing military victory. His advice is credited, for example, with having greatly influenced Mao Zedongs approach to conflict and the subtle tactics of revolution and the ways in which North Vietnam and the Viet Cong thwarted Americas military advantages. The formulation of general strategic principleswhether applied to war, parlor games such as Go, or politicshas long fascinated scholars. And regardless of context, the study of strategic principles is of interest because it grapples with fundamental facts of human existencefirst, peoples fates are interdependent; second, this interdependence is characterized generally by conflicting goals; and, finally, as a consequence of the first two facts, conflicts such as war are not accidental but are the purposeful extension of a states or an individuals motives and actions and must be studied in a rational way.

The Art of War is, insofar as we know, our first written record of the attempt to understand strategy and conflict in a coherent and general way. It is important, moreover, to recall that it was written at a time of prolonged conflict within an emerging China whereby the leaders of competing kingdoms possessed considerable experience not only in the explicit conduct of war, but also in diplomacy and strategic maneuver. As such, then, we should presume that it codifies the insights of an era skilled at strategy and tactics, including those of planning, deception and maneuver. This assumption, though, occasions a question: Although The Art of War was ostensibly written for the leader of a specific kingdom, what if all sides to a conflict have a copy of the book (or, equivalently, an advisor no less insightful than Sun Tzu)? How might our reading of Sun Tzu change if it is common knowledge that everyone studied The Art of War or its equivalentwhere by common knowledge we mean that everyone knows that everyone has a copy of the book, everyone knows that everyone knows that everyone and so on, ad infinitum. The assumption of common knowledge presumes that not only is each decision maker aware of the situation, but each is aware that the other is aware, each knows that the other knows, and so on and so forth, and after being told by Sun Tzu himself that the great trap to be avoided is underestimating the capabilities of ones opponents, it seems imperative that the implementation of his advice proceed with the presumption that common knowledge applies.

In the case of The Art of War, taking account of the possibility that both sides of a conflict have a copy of the book differentiates the social from the natural sciences. In physics or chemistry, including their practical applications, one does not assume that the scientist or engineer confronts a benevolent or malevolent nature that acts strategically to deliberately assist or thwart ones research or the application of natural laws as we understand them. Things might not function as designed, but only because our understanding or application of natures laws is imperfect. In the social sciences, on the other hand, especially in the domain of politics, it is typically the case that individuals must choose and act under the assumption that others are choosing and acting in reaction to ones decisions or in anticipation of them, where those reactions can be either benevolent or malevolent.

Despite this fact, it is our experience that most readers of The Art of War implicitly or unconsciously (at least initially) take the view that the reader is the sole beneficiary of Sun Tzus advicethat ones opponent is, much like nature, a fixed target. This might have been a valid assumption in 225 bc China in the absence of the internet, printing presses and Xerox machines, but it is no longer valid given the worldwide distribution of the book, including having it as required reading in business schools and military war colleges. So a more sophisticated student of Sun Tzus writings might suppose that ones opponents have read the book as well, and might then reasonably assume that their opponents tactics and strategies conform to Sun Tzus guidance. But suppose we take things a step further and try to interpret an opponents actions not simply with the assumption that theyve read the books with which we are familiar, but also that they know we are familiar with those books and that we are not only attempting to assess their tactics and strategies in light of the advice contained in The Art of War, but also that we are attempting to take into account the fact that they are attempting to take into account our familiarity with that advice.