Chapter 7

1. Browning (1989), 364.

2. I am assuming that both criminals would rather receive a punishment of life in prison than be executed.

3. See McMillan (1992), 118–119.

4. If there were a smart pill that would give me a slight chance of getting cancer but also give me a reasonable shot of winning a Nobel Prize in economics, I would probably swallow it.

5. It’s true that some professional basketball players can make large salaries through endorsements. But they are able to do this only because of their prior success in their sport. As a result, endorsement money can be seen as part of an athlete’s basketball salary, although a part not paid by his team.

6. In economics such a phenomenon is called a “backward-bending supply curve.” As people get richer they usually desire greater leisure time. Paying someone a higher salary makes a person richer and consequently could cause him to work less.

7. Carter (2002), 111.

8. McMillan (1992), 66 applies prisoners’ dilemma to the oil extraction problem.

9. Ibid.

10. Gibbons (1992), 224–225.

11. See Axelrod (1984), 110–113.

12. Ibid., 77.

13. See Axelrod (1984), 86 who cites Hills (1919), 96.

14. See Axelrod (1984), 78–79.

15. See Axelrod (1984), Chapter 4.

16. Brandenburger and Nalebuff (1996), 161–169.

17. See Smith (1982).