THE SOCIAL DILEMMA GAME

You are in a group of five people. Each member of the group has an initial holding of $15 (just enough to guarantee to no one ends up with a net loss, regardless of the outcome of the game). You have the opportunity, based on your own actions and those of the others in the group, to earn an additional amount or to lose some or all of your initial holding.

You (and each other member of the group) must choose between two actions, designated LEFT and RIGHT (no political connotations intended), which have these consequences:

(A)      If you choose LEFT, you earn $25 and your action has no effect on any other group member;

(B)      If you choose RIGHT, you earn $50 but your action also imposes a cost of $10 on each member of the group (yourself included, so you net $40).

So, holding constant the choices of all others, you earn $15 more by choosing RIGHT rather than LEFT.

Your goal is to maximize your own earnings, and you know that everyone else is similarly motivated.

Version 1.     Each player must make his or her choice in isolation, without talking to other players.

Version 2.     Players can talk among themselves (and make deals or whatever) prior to making their choices.

But, in both versions, final choices are made by "secret ballot."

Do you choose LEFT or RIGHT?

Analysis. With five members in the group, this game has six classes of outcomes, according to how many group members choose LEFT and how many chose RIGHT, with the following "payoffs":

                                                          Each player wins, depending    So the group as a

          Number who choose              on whether he/she chooses         whole wins

                  LEFT     RIGHT                      LEFT         RIGHT 

1.                  5         0                                $25             —                               $125

2.                  4         1                                $15            $40                             $100

3.                  3         2                                  $5            $30                               $75

4.                  2         3                                 -$5            $20                               $50

5.                  1         4                               -$15            $10                              $25

6.                  0         5                                  —               $0                                $0

 This is the standard (two-player) Prisoner’s Dilemma story:

           (a)      Two prisoners are held in jail separately and cannot communicate.

          (b)      The District Attorney has evidence that they jointly committed a serious crime, for which the penalty is six years in prison.

          (c)      However, this evidence is insufficient to convict either prisoner, in the absence of a confession by the other.

         (d)      But the D. A. has other evidence sufficient to convict each prisoner on a less serious charge, for which the penalty is two years in prison.

          (e)      The D. A. goes to each prisoner and offers the following deal (telling each the same offer has been made to the other): if you confess (implicating the other), I will take two years of whatever your sentence otherwise would be.

          (f)       Will either prisoner accept the D. A.'s offer? Would they choose differently if they could communicate?

                                                                                   PRISONER 1