Common people are not supposed to be interested in Game Theory, the study of strategic decision-making where the outcome for each participant depends on the choices of others. However, this theory has become relevant in recent times because of Donald John Trump‘s Tariff War with other countries and armed conflicts taking place in different parts of the globe. As Game Theory does not have the ability to predict the future, it cannot foretell the US President or Israeli Prime Minister Benjamin Netanyahu‘s next steps. Although Game Theory is a framework for understanding, as well as predicting, behaviour in situations involving conflict or cooperation; it cannot even identify a move that guarantees victory. However, the theory can certainly explain the current global geopolitical landscape. Hence, analysing political policies is futile without Game Theory. From Trump’s tariff policies to the US airstrikes on the Iranian nuclear facilities, these are all different types of games. Game Theory helps one to understand how these games are played.

As President Trump began imposing tariffs on various countries, a game, called Chicken Game, became quite popular. In the US, timid persons (those who are perceived as being afraid or unwilling to do something) are called Chickens. Chicken out is a popular informal idiom in the US. It means to withdraw from doing something, usually due to fear or a lack of courage. The idiom implies that a person decides not to proceed with a planned activity or action because s/he is scared or hesitant. When the US President was forced to suspend the Tariff War even after triggering it, the American press jokingly dubbed the incident Taco: Trump Always Chickens Out. According to investors, whenever the US President faces a market backlash, he backs down.

Although the term Taco has become a popular one across the globe, the description of this game is completely wrong in this particular case. The Chicken Game, as described in the textbooks, involves two players or teams, each with two strategies or choices. Let’s assume that the two strategies are aggressive action (attack) and non-violent response (remain peaceful). In case of Tariff Wars, the strategy should be to impose or not to impose tariffs on foreign products. And, leaders of the two countries will decide what they will do. The condition of this game is that they have to choose any particular strategy at the same time. It may be noted that Chicken Game is a classic example in Game Theory where the optimal strategy of each player depends on what the other player does.

However, this condition is incompatible with the Tariff War because the Game of Tariff is not played by the two players at the same time. In other words, the Game of Tariff is not a static one. In this case, the two rival countries, like the US and Canada, would make decisions one after another, and not simultaneously. First, the US will impose tariffs on Canadian products. And then, Canada will decide its move (in response). Also, this game is not played just once. China and the US or the US and Canada have already played multiple rounds of the Game of Tariff (by taking measures and counter-measures against each other) in recent times. Hence, this game is dynamic in nature.

Instead, the Chicken Game helps one to analyse the armed conflicts, such as the Russia-Ukraine War, the Israel-Hamas War, the Israel-Iran War and the India-Pakistan Conflict. In each case, both countries decide whether it will attack the enemy (or not) at the same time. One can consider an armed conflict a Chicken Game. If any country decides not to attack its enemy, it will chicken out.

In the Chicken Game, if both players become aggressive, then collateral damage would be inevitable. It is better for everyone if both parties show restraint. And if one player decides to launch an attack and the other remains calm, then the aggressive player will win the game. This is how the outcome of the Chicken Game is decided. In Game Theory, the theoretical solution is called the Equilibrium. Specifically, a Nash Equilibrium is a common type of equilibrium in non-cooperative games, where no player can improve their outcome by unilaterally changing their strategy, assuming other players’ strategies remain the same. It represents a stable state in the game where all players make the best possible choices given the actions of others. The Nash Equilibrium of this sort of Chicken Game is that one player will be aggressive, and the second one will retreat. In other words, one country will attack, while the other will surrender.

Theoretically, one of the two countries will withdraw itself from the conflict due to fear factor. However, there is a flaw in this solution. Firstly, there is no guarantee that one of the two warring countries will chicken out just because a Nash Equilibrium is being created theoretically. Even if it is assumed that one country will withdraw, it is difficult to predict which one will make such a decision (as both countries are in Nash Equilibrium). Secondly, each country’s chosen strategy is the best response to the other’s strategy. According to Game Theory, mediation will become absolutely necessary in such a situation. The outcome of a Nash Equilibrium can be improved through mediation. However, President Trump cannot encourage or force two warring countries to reach a ceasefire.

Game Theory can be used to analyse the dynamics of conflict and potential paths to peace, as it explores how rational actors might choose to escalate or continue a conflict based on their perceived self-interest. In reality, it is expected that both countries will try their best to restore peace even after engaging in a conflict. However, it cannot be considered a Nash Equilibrium.

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Published by Koushik Das

Koushik Das (born on May 16, 1976 in Kolkata) is a career journalist. Based in the Indian capital of New Delhi, Koushik writes mainly about foreign policies and current geopolitical issues, and rarely about other topics. His own political ideas are highly influenced by Antonio Gramsci, Louis Althusser, Michel Foucault, Michael Oakeshott and others. English philosopher and political theorist Oakeshott (Dec 11, 1901-Dec 19, 1990) says that “in political activity, men sail a boundless and bottomless sea. There is neither harbour for shelter nor floor for anchorage, neither starting-place, nor appointed destination. But we have to keep afloat”. (Rationalism in Politics, 1962) As a student of Political Science, Koushik loves to share his views on issues, which have great impacts on his thought process (and also on India, South Asia and of course on the global community), with his readers through his website – Boundless Ocean of Politics. By doing so, he tries to keep himself afloat. You will find some of his articles in https://inserbia.info/today/ (https://inserbia.info/today/author/kou_das13_i/), as he has been trying to assess the global geopolitics since 2003. You can also mail him at kousdas@gmail.com View all posts by Koushik Das