Game theory: on maximizing profits and cooperation
Social science is an interesting field, but it is one with a big problem: subjectivity.
There is no universal truth, because the way we experience the world is subjective, therefore finding universal rules such as gravity or thermodynamics is difficult. We have seen this in the last article when we looked at the prisoner’s dilemma: there’s not one universally rational way of solving the problem, because depending on the values of the players, their perception of the game and so on, the most rational choice to make changes. We have also briefly hinted at the common pastures problem, which is a multiplayer version of the prisoner’s dilemma: this is where the environment comes in and also, coincidentally, where Cosmos for Humanity comes into play.
On the necessity of cows
Game theory has many “games”, and they were not just created for the sake of having academics debate over them, but to explain why people act the way they do in certain situations. For example, the common pastures problem was a metaphor created by Garrett Hardin to explain how overpopulation would eventually lead to a scarcity of resources because it would put a strain on the environment.
For those of you who are not familiar with the common pastures problem, here’s a recap. We have a village with a common field where people leave their cows to graze, and ten farmers who each own one cow, and let their cows graze in the same pasture. Eventually some farmers get rich enough to buy another cow, so as soon as they get enough money to do so, they all start getting another. Unsurprisingly all cows start becoming thin and go hungry, because the number of cows is rising but the amount of land available isn’t (something people tried to fix with colonialism back in the day). By the time the tenth farmer buys a cow, all the others have starved: everyone behaved rationally, and yet everyone now is dying. According to Hardin, “therein is the tragedy. Each man is locked into a system that compels him to increase his herd without limit — in a world that is limited. Ruin is the destination toward which all men rush, each pursuing his own best interest in a society that believes in the freedom of the commons” (Hardin 1968).
Here it is argued that every man is compelled to increase his herd without limit, and this is what game theory would define as a rational behavior. Rational choice theory, which is also the foundation of economics, says that making choice rationally means for individuals to consider their preferences and choosing what will get them closer to their goals. The problem is that often this is equated with “maximizing your payoff”, and here is where we get the idea that maximizing your gains is a natural thing that every rational individual will do, but we know that that hasn’t been the case everywhere and for everyone. The tragedy of the commons as described in the example couldn’t have happened, for example, to the indigenous populations in the Americas: it wasn’t customary for them to take from the environment more than they needed, and overproduction wasn’t a thing.
Moreover, the situation isn’t unchangeable for our group of farmers: they could at any point realize that by buying too many cows they risk destroying their plot of land, and they could decide to change strategy. This is what the fight to reverse climate change is trying to do, and it is also what Cosmos for Humanity wants to do with regards to space resources. We are not yet at the point of no return, and the outcome is not yet determined. Furthermore, Hardin’s formulation makes it sound as if the problem was also the “society that believes in the freedom of the commons”. The problem might very well be rooted in society, but it isn’t the freedom of the commons that leads people to overexploit the environment so much as the need to overproduce, overconsume, and a structural blindness to the effects present actions will have on the future.
Finally, here’s a more realistic framing of this problem: one or two farmers get rich enough to buy other cows, and they do so. This makes them get richer faster, and before the other farmers manage to even buy a second cow, they have bought a third and a fourth. The tenth farmer never gets to buy his second cow. The result is the same, the plot of land is not enough, and the cows are all starving, but if we put it like that it becomes clear that it was the greed of the few that caused the downfall of the many. We could argue over whether it is important to assign the blame, both in this example and when it comes to climate change and overexploitation of the environment. Some would say it is not relevant to know who did what, because the result is the same. We could safely assume that if we asked this to the tenth farmer, he would not agree.
The common resource problem
Hardin believed that a society with freedom of the commons was doomed to destroy itself and therefore, it was necessary to have a centralized government to control these common resources. Other scholars thought that the establishment of property rights on common pool resources was the only way to stop the tragedy of the commons from happening. Not everyone agreed with these views, particularly Elinor Ostrom. In her works, particularly in “Governing the Commons”, she tried to dismantle the idea that “individuals sharing a commons are inevitably caught in a trap” but instead argued “that the capacity of individuals to extricate themselves from various types of dilemma situations varies from situation to situation” (Ostrom, 1990).
She argued that the privatization of common-pool resources could have been theoretically possible with plots of land, but when it comes to “nonstationary” resources such as water, air and even fisheries, “it is unclear what the establishment of private rights means” (Ostrom, 1990). In general, she questions whether privatization or centralization are the only solutions available and that’s why her research focuses on empirical cases on self-governing, self-organized and long-term common pool resources across the world. Moreover, she criticized the common pastures problem and the prisoner’s dilemma: when referring to these game theory models, she said that they were dangerous “when they are used metaphorically as the foundation for policy” because “the constraints that are assumed to be fixed for the purpose of analysis are taken on faith as being fixed in empirical settings, unless external authorities change them” (Ostrom, 1990).
Space as a Commons
Understanding game theory and discussions surrounding the commons is important when it comes to how orbits are handled. Not only is the common pastures problem relevant when it comes to resources we find on Earth such as water, air, land and food, but it applies also to orbits.
When we humans first launched our satellites, we thought we had just gained access to unlimited resources. Later we found out that that’s not the case: orbits are a limited, common resource. Since everyone can go to space if they have the means to and more and more companies are starting to do just that, if we want to continue to enjoy the benefits that orbits and therefore satellites give us, we must drastically change our behavior in space. There’s already way too much debris taking up space in orbit, causing accidents and putting people and infrastructure at risk. Satellites are used to monitor climate change and natural disasters around the globe: if they break down because of debris, or we can’t afford to put any more in orbit because there is not more space in orbit, our fight against climate change would suffer from it. To protect the orbits is to protect the Earth.
One of the ways in which Cosmos for Humanity plans to do this is by creating an Outer Space Footprint (OSF), which would work a bit like the Carbon Footprint. It would encourage space actors to adopt more sustainable behaviors in space and allow users to make responsible choices when it comes to their service providers. This way, they could choose to support companies with a good OSF, who respect orbits and act responsively in space. In other words, from a game theory point of view, the OSF is intended to become a “Schelling point” for Outer Space sustainability.
Conclusion
Game theory was often used as a base to formulate policy or to inform the choices of economic actors. This is why it is important to not take for granted these games, but to look at them critically and dissect them. We have looked specifically at the prisoner’s dilemma and at the common pastures problem because they have been used to explain non-cooperation and the degradation of the natural environment. These things have been written off as “natural” and “irreversible” but other scholars prove that this is not true.
While looking at the common pastures problem, we act as if overproduction was a byproduct of rational behavior, as if buying another cow was a given, something everyone would do with a bit of spare money when that’s not the case. In so doing, we forget that it is simply a feature of capitalist, sedentary, agricultural societies characterized by a centralized, tax-collecting government. If we keep this in mind, suddenly we realize that the tragedy of the commons could be avoided in many ways. The farmers could decide that buying another cow is not necessary, or they could look for solutions to better use the collective resource without completely depleting it. We are not yet at the point of no return: we can still act to preserve our common resources, and it is counter-productive to look at these games and think that we are doomed.
It is not too late to protect our orbits. We all have the duty to solve the space pollution problem, which is as much a common resource as water or air: this is Cosmos for Humanity’s mission, and this is what we plan to do with the creation of the Outer Space Footprint.
