Game theory is all around us, especially in reality television. The field of game theory “attempts to mathematically capture behavior in strategic situations, or games, in which an individual’s success in making choices depends on the choices of others.” Don’t believe me? Just watch the ending of The Bachelor Pad.
I caught the finale of The Bachelor Pad (billed as the “The sexiest participants from the hugely successful “Bachelor” franchise reunite under one roof in a competitive reality series to compete for $250,000″) at a friend’s place. First of all, I am a little glad that there were no pretense of “finding the one for me” a la The Bachelor.
Secondly, since I’ve never seen an episode before this, I got to miss all the drama and instead focus on the neat little game theory twist the producers introduced at the end: The winners, Dave and Natalie, are awarded $250,000 to share. But wait, how much they ultimately get depends on their choice and the choice of the other winner.
Imagine if you are Dave or Natalie, you have two choices – to “keep” or to “share”. Without discussing the issue with your co-winner, you must decide whether to:
“Keep” the money for yourself or “Share” the money with the Other Winner.
|
What to do? |
You: Keep the money |
You: Share the money |
|
Other Winner: Keep the money |
You get $0. Other Winner gets $0. (the money goes to the losing contestants) |
You get $0. Other Winner gets $250,000. |
|
Other Winner: Share the money |
You get $250,000. Other Winner gets $0 |
You get $125,000. Other Winner gets $125,000. |
As the matrix shows, if you select Keep, you have a 50% chance of getting nothing and a 50% chance of getting $250,000. If you select Share, you have a 50% of getting nothing and a 50% of getting $125,000.
Now, the mathematically smart thing to do here (if you have no knowledge of the other person’s character) is to always select “Keep,” because you are maximizing your chance to get the most money. But if both people though the same way, then neither of them will get any money. So it boils down to the assumption: do you think the other winner will Share or Keep? If there is no trust between the two person, then you have nothing to lose by selecting “Keep.”
Still, there seems to be something unsavory about selecting the “Keep” – and besides, if both winners selected Keep, then the audience can say good riddance because then they both would have ended up with $0. But the losing contestants would have been very happy!
Dave and Natalie decided to share in the money. But can you imagine the fury that would erupt if one person selected Keep while the other one selected Share? Game theory – love it!


