Paper: Covid Congressional Inquiry and Game Theory

Dear friends,

It is not at all absurd to compare the Covid Congressional Inquiry (CPI in Portuguese) to a game. After all, not few people think that the committee’s noblest objectives are in the background, and what really matters is its politicization. In this sense, it remains to be seen whether the CPI will be a cooperative or non-cooperative game, according to the interests of the “players”; on the one hand, the government and its allies and, on the other, the majority of the CPI. Economists have helped us a lot in this area with Game Theory, a structure to model scenarios in which there are conflicts of interest between players, who try to mutually predict their decisions in a sequence of actions and reactions.

Rational choices seem to direct our attitudes so that the results always suit us best. Mathematician John Nash proposed what is known as Nash Equilibrium in a competitive game, wherein no player has any incentive to change his strategy after evaluating her opponent’s choice. On the other hand, in a cooperative game, the solution to the problem involves an unbiased (generally unfair) distribution of losses and gains from the players involved, that is, in the view of economist Lloyd Shapley, a coalition. From this cooperation rises the Shapley Value concept, which states that each player will enjoy a better payoff than if they were acting in isolation. Thus, for the first case, Game Theory presents us as being intelligent and, for the second, as being fair.

 

To read the Paper, click here.

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