Social Contracts in the Game of Life

Published by timdean on

“We are all players in the game of life, with divergent aims and aspirations that make conflict inevitable. In a healthy society, a balance between all these differing aims and aspirations is achieved so that the benefits of cooperation are not entirely lost in internecine strife. Game theorists call such a balance an equilibrium. Sustain such equilibria requires the existence of commonly understood conventions about how behaviour is to be coordinated. It is such a system of coordinating conventions that I shall identify with a social contract.”
– Ken Binmore, Game Theory and the Social Contract, Volume 1: Playing Fair, 1996, p6

Ken Binmore

Ken Binmore

And there you have it. One of the most straight-forward articulations (assuming if you understand the concept of ‘equilibrium’) of what a social contract is and why we might want one, and it appears but six pages in to Binmore’s epic two volume series on game theory and the social contract. I’m going to enjoy reading this.

But Binmore has other tidy revelations in the following pages, such as that the Left is often misguided because it proposes contracts that break through ‘feasibility constraints’, and as a result, proposes utopias that are inherently unstable.

The Right, on the other hand, values a nice stable equilibrium so much that it clings to yesterday’s contract and resists change that might bring about an improved contract – often resisting it to the point where the only possibility of change becomes revolutionary change.

A final tid bit – of particular pertinence to politicians –  is that one ought to always consider the feasible before considering the optimal. Another way of putting this is to say that, prior to criticising the status quo, one ought to consider the next best feasible option, and if it’s worse than the status quo, then one ought to reconsider one’s criticism.

We need more game theorists contributing to philosophy, IMO.


James Gray · 1st April 2010 at 8:58 pm

A lot of the criticism that I find attractive is precisely the kind that doesn’t offer an alternative. Many “socialists” hope that we can find better alternatives to capitalism without actually knowing what it would look like. They want to criticize the status quo in order to motivate us to start thinking about making improvements. One reason they don’t necessarily want to talk about the alternative is because it is tempting to jump to conclusions about utopias and so forth when we need to be careful about how we change society. It might be a good idea to make change one step at a time with the realization that risk is involved.

I agree that we do want alternatives, but I think it is perfectly fine to criticize the status quo to stimulate discussion and the facilitate the thought process before a viable alternative is fully understood.

I also wonder how philosophical the so-called horrible utiopias really were. I am tempted to think that such “horrific” utopias were not philosophically motivated and tended to involve certain people’s lust for power rather than a genuine interest in justice. The Soviet Union was nothing like what Marx wanted.

Tim Dean · 1st April 2010 at 10:31 pm

Over here, we call criticism without offering an alternative “whinging”.

But, in the spirit of offering up an alternative, let me rephrase my tid bit as: one ought not push for a change to the status quo without first checking that it’s either feasible or preferable to the status quo.

All too often I hear ideas promoted with great vigour that seem appealing on the surface but would, in actual fact, cause more harm than good. One common example is the appeal that politicians should earn less, or even not be paid at all. Were that to happen, only the independently wealthy could afford to enter politics, which would risk skewing politics in favour of those who can afford to participate.

Another is that we should regulate to mitigate against highly unlikely events to such a point that the cost of regulation is substantially greater than the cost of the unlikely events themselves. Doesn’t mean regulation itself is bad, just that we need to apply it with an eye to outcomes rather than intentions.

And even though the Soviet Union wasn’t Marx’s vision, it was Marx’s vision that led to its creation. Not that he’s responsible, but he posited an inherently unstable system – one that was predicated upon the goodwill of the members of that system in order to work – so its no surprise the vision was corrupted before it became a reality. I don’t discount everything Marx said, but I am dubious of any proposed utopia that is inherently unstable.

James Gray · 2nd April 2010 at 7:14 am

People propose ideas, such as the one where politicians shouldn’t be paid. That in itself is an alternative, and you are right that it could be a worse one than the current system.

A common criticism I hear of the current system is the prison system itself. There are all kinds of ways we could try to make it better and some people even propose we do away with it. No one would be stupid enough to get rid of the prison system overnight without a viable alternative, but criticizing it is still a good idea.

Criticizing capitalism seems like a good idea for the same reason. To do away with it over night would be foolish and unfortunately it has happened before. That is one reason the Soviet Union was horrible. I don’t think the Soviet Union ever required “good will.”

Paul · 2nd April 2010 at 8:43 am

“A final tid bit – of particular pertinence to politicians – is that one ought to always consider the feasible before considering the optimal. Another way of putting this is to say that, prior to criticising the status quo, one ought to consider the next best feasible option, and if it’s worse than the status quo, then one ought to reconsider one’s criticism.”

I’ll admit to only ever having read one essay each by Kenneth Arrow and James Buchanan, but I do wonder if this squares with the intrinsic motivation of politicians to power. In the U.S., I think that it is common practice for politicians to do precisely this sort of thing, precisely because it is political optimal. Republics have no real intention of outlawing abortion; yet talking about abortion does drive solidly Republican voting blocks to the polls. Similarly, Democrats talked a whole lot about Afghanistan and Iraq in 2006, yet they didn’t actually change any Bush policies once they had power. But it really did help them win a lot of seats in the legislature.

Such is life in a multi-ethnic democracy whose peoples have very divergent interests. However, for more strongly communitarian nations, which also happen to be the more ethnically homogeneous ones, that may be good advice, as the long term exercise of power by politicians rests on the quality of governance of the country, not over the tribal question of who should have preeminence over others.

Tim Dean · 2nd April 2010 at 10:07 am

One of the master strokes of democracy was to (if imperfectly) align the public good with the self-interest of politicians. The idea is that you can let the politicians pursue their self-interest – desire for power, for popularity, for ‘making a difference’, whatever it is, within reason – and in doing so, they’ll be advancing the interests of their constituents.

The system is horrifically imperfect and in need of constant oversight and reform, but, echoing my tid bit above, Winston Churchill called it the ‘least worst’ system we have. And I tend to agree, that’s if you consider a sustainable equilibrium better than an unstable utopia.

And James, let me reiterate: I’m not against criticism. I’m against imprudent action. Hence my revised tid bit. Criticism is crucial. Heck, being a philosopher, I’m all about criticism and not so much about action. But before we act, it would be prudent to make sure the consequences of that action are both feasibly achieved and preferable to the current state of affairs.

Take closing prisons. The notion may commit what I call the ‘utopian fallacy’. This is the idea that: ‘if everyone was nice to each other, we’d all be better off’. Or, in game theory terms: ‘if everyone cooperated and no-one defected, we’d reach Pareto optimality’.

This is true, and the Pareto optimal level would be preferable for everybody. However, as long as there are defectors – or people who aren’t nice but screw others over for their own benefit – then the utopia breaks down towards the Nash equilibrium. And I’d conjecture that the existence of such defectors would be inevitable.

So, unless you can guarantee that none of those prisoners would re-offend – and as a matter of empirical fact, I’d suggest one cannot make that guarantee (especially with psychopaths) – then closing prisons would be worse than having them.

Doesn’t mean we shouldn’t work hard to make sure prisons are as effective as possible in their role. Reducing our tendencies for retribution, not incarcerating non-violent criminals but punishing them a different way, encouraging rehabilitation as much as possible and reducing the overall number of criminals by decriminalising certain things such as drug use, would probably nudge the world a little closer to a better equilibrium.

James Gray · 2nd April 2010 at 1:54 pm


I’m sure people commit the utopia fallacy, but there are people who really do think there is a viable alternative to prison, although that is not going to be an option any time soon. I don’t know a lot about it, but certainly “preventive” measures seem a lot more effective and therefore a wise investment.

If an alternative to prison is merely that better education, equality, and other preventive measures will have a secondary effect of making prison unnecessary, then we would have to wait and see what happens for ourselves. I agree that this situation sounds unlikely given our continual struggle for greater power, interest in cutting corners, and the simple fact that we make mistakes.

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