Parents, as well as
If the daughter trusts in her parents’ love, then she will believe that the threat was made to improve her welfare. If the daughter became pregnant, she would need her parents more than ever. The daughter should thus realize that her caring parents would
Circumstances in life and business often arise where you would gain from making a believable threat. Unfortunately, game theory shows that many threats can and should be ignored, since a man is never as good as his word in game theory land. Game theory, fortunately, provides many means of making credible threats.
Normally, you benefit from choices. We usually think that the more options we have, the more ways we might profit. The existence of some choices, however,
Imagine that you’re a medieval military commander seeking to capture the castle depicted in Figure 2. Your troops have just sailed over on boats to the castle’s island. Everybody knows that if you were determined to fight to the end, then your army would ultimately be victorious. Unfortunately, the battle would be long and bloody. You would lose much of your army in a full-blown battle for the castle, so you desperately pray for your enemy’s surrender. Since the enemy
Figure 2
Unfortunately, your enemy has
Your opponents would immediately capitulate if they believed you would fight to the end, so if you could make a believable threat to fight until victory, they would give up and you would not have to risk your troops. Unfortunately, a mere threat to fight to the finish lacks credibility, so what should you do? You should burn your own boats!
{% if main.adsdop %}{% include 'adsenceinline.tpl' %}{% endif %}
Imagine that if your boats were burned, it would take many months for your
Cortez, conqueror of the Aztecs, employed this boat-burning tactic.
[2]
Shortly after landing in Mexico, Cortez
[2] Dixit and Nalebuff (1991), 152–153.