Evolution and Prisoners Dilemma

Evolution and Prisoners’ Dilemma

The power of the prisoners’ dilemma paradigm extends even to evolutionary biology. When humans play games, we usually assume that we rationally choose whatever strategy maximizes our payoff. Biologists sometimes apply game theory to animals and assume that the animals’ genes dictate how they play their games.^[17] Imagine that some creatures are repeatedly playing the prisoners’ dilemma game in Figure 44. A creature’s genes will tell it to play either nice or mean. The creatures receive food as their payoff. The more food a creature has, the more offspring it produces, and the more its genes will spread. The genes that are best for playing the game will survive while those that receive consistently poor scores will become extinct.

Figure 44

Imagine that there are two colonies of creatures separated by some considerable distance. In one colony all the creatures have genes telling them to play nice, while in the other, the genes dictate that the creatures be mean. The offspring in both of these colonies would always have the same genes as their parents. The creatures in both colonies repeatedly play the prisoners’ dilemma game in Figure 44. The nice colony would appear to have an advantage. Because everyone in this colony is always nice to each other, everyone gets a payoff of 5 foods each round. In the mean colony everyone always gets a payoff of only one food. The nice colony should expand relative to the mean colony.

The colony of the creatures with mean genes, however, has one critical advantage over their nicer rivals. Consider what happens when the nice colony expands to the edge of the means and competes directly against them. The mean creatures will do very well in this game, and the nice creatures will die. When the nice colony creatures play only against each other, they beat the mean colony. When they play against the mean creatures, however, the mean creatures dominate. This contest between nice and mean shows that nice guys finish first only when they don’t have to compete against mean people.

Let’s apply our evolutionary game to business cultures. Imagine that two divisions in a company have radically different cultures. In one culture, everyone is nice to each other, and in the other, everyone is always mean. These cultures are not the results of rational choice, rather they simply persist. When someone is hired in the nice culture, their surroundings automatically make them nice, and similarly anyone recruited into the mean culture becomes mean. The employees in the nice division will do better since they all cooperate with each other, while employees in the mean division always undercut each other to get ahead.

The theory of prisoners’ dilemma, however, shows that the nice culture is extremely unstable. If just a few mean people start playing in the nice division and aren’t converted, then the nice employees will starve. A cluster of nice employees will make higher short-term profits for your company, but their culture is unsound, for even a few meanies can destroy it.

^[17]See Smith (1982).