The Prisoner's Dilemma... (28.25)
Bryan: So, ground rules.
Chuck: I'll do all of the talking. We have someone else that made the same pharmaceutical trade. First one in gets a lollipop.
Spyros: But to be clear, we don't really have anyone?
Chuck: To be clear, I am making a play.
Spyros: That's what I like to call the prisoner's dilemma.
Chuck: No, you don't like to call it that. That's what it's called. Started as a thought experiment, game theory in the '50s. Does no one ever check you on this bullshit?…
The prisoner's dilemma is a standard example of a game analyzed in game theory that shows why two completely rational individuals might not cooperate, even if it appears that it is in their best interests to do so. It was originally framed by Merrill Flood and Melvin Dresher while working at RAND in 1950. Albert W. Tucker formalized the game with prison sentence rewards and named it "prisoner's dilemma".