Source: Arrival (dir. Denis Villeneuve)

Why Are You Here? The Give/Take Relationship Game Theory

Relationships can be alienating.

Arrival is an incredibly interesting movie because, like many sci-fi films, it imagines communication with an alien race. Throughout the film the protagonists are seeking the answer to a simple question: why are they here?

Communication is the fulcrum of all relationships. Fundamentally, communication is a process of exchange.

Given that my education is in the study of economics, I happen to know a thing or two about exchanges.

I promise that if you learn just a little bit about economic exchange, there are a few practical life applications. Trust me?

Note: the following Give/Take Relationship Game Theory is mostly applicable to peer relationships (as with friendships) and not as applicable to dependency relationships (as with children).

Boring Microeconomic Game Theory

In microeconomics, game theory is used to conceptualize models of competition and market pricing. Because all relationships are unique (even if faint) connections between two individuals, we’ll consider them to be effective oligopoly markets. For example:

Source: Brigham Young University

In this scenario, both companies make more by choosing a low output (three cheers for OPEC). The second best outcome is for both companies to choose a high output. In both scenarios where one company is implementing a low output strategy and the other is implementing a high output strategy, there is instability because one company is clearly losing. In both the high/low and low/high scenarios, the losing company will eventually change their strategy to high output, which makes high/high the most likely outcome.

In other words, the second best option has the highest likelihood because both companies are profit-driven.

Unless there is collusion. Collusion occurs when the companies make a prior commitment choosing low output to optimize both of their profits.

However, collusion is a fundamentally vulnerable position for both parties because, at any time, the agreement could be violated if one company gyps their partner with a high output strategy for some short-term gain (three more cheers for OPEC).

Indelibly Interesting Relationship Game Theory

In order to apply this to relationships, we’ll just copy the diagram because my arrogance permits me to believe that game theory explains everything. Everyone is white or yellow. I’m sorry, but that’s the way it is.

Source: Me

Please note: The outputs on this diagram are switched because friendships are not usually based on competing for profit in the marketplace.

Just like in the previous case study, the optimal solution is give/give but the most likely solution is take/take. Both take/give and give/take are unstable options (unless it is an inherently dependent relationship).

Collusion is an option, but because it is not socially accepted to sign agreements with your friends demanding high output, things are more ambiguous.

Without stretching this analogy too far, there are two useful conclusions we can draw from the comparison:

  1. Both parties exercising generosity in a relationship is the most vulnerable and the most rewarding outcome
  2. Relating to someone for selfish reasons will almost always reduce both parties to selfish behavior to secure the second-best outcome

Mutually selfish relationships are the safest option, but approaching all relationships from the attitude of giving has the most potential for good.

So now, I only have one question for you — and it’s a question I plan to ask myself on a regular basis from now on…

Why are you here? Do you show up to take or to give?