Game Theory and Monopoly
A game is a carefully structured form of activity, normally undertaken for fun or entertainment, and at times used as a teaching tool. Games are very different from work, which generally are carried out only for monetary compensation, and from literature, which are primarily an expression of visual or aesthetic elements. The purpose of any game is to exercise the mind in a way that develops it to the greatest possible degree. In order to do this, the game needs to be well designed, with the right set of features.
To start with, a game needs to have its own set of rules, which must be clearly stated up front. These should include a defined beginning and an end, a set of goals (such as completing the game), the variables that affect the course of action, the nature of winning and losing, the methods by which any win or loss can be made, a method by which one player can get “retained” and another eliminated, and so on. One might suppose that all this sounds complicated, but it really isn’t. A simple game such as prisoners of war, for example, has all these elements laid out unambiguously, so that the player can understand what he is doing. It is up to the player to either cooperate with the others or to defect and try to lose.
Now, if you want to develop your understanding of game theory further, you will need to move on to Nash’s law, which states that people will respond to incentives rather than to logic or reason. There is some debate as to whether Nash’s law is true, but it certainly holds valuable lessons for those of us who study human behavior. The first major lesson is that humans do not act in similar ways to animals. People aren’t, for example, likely to cooperate with each other when there is a chance they might lose the game to someone else. People, however, will usually cooperate when the benefit of doing so is greater than the cost of not doing so. That is why it is often more effective to cooperate with others in a game of strategy than to compete with them, even if the results of your actions do little for you.
Another important lesson from game theory is that people will not always behave in the same way at the same time, so it is important to try to develop a strategy for when the best time to play is. When equilibrium cannot be achieved in a single game, a combination of stable policies will almost always yield a win. That is why it is so important for students to learn about economic theory and its application to the game of Monopoly, in particular its relevance to the game’s end game.
Finally, let us consider how the game of Monopoly affects the game theory behind monopoly games. As we have seen, the game gives players an incentive to cooperate, making them willing to enter into a stable long-term relationship. However, the stability of this relationship does not last forever. If other players are quick to steal monopoly properties and refuse to pay the rent, the game will quickly degenerate into a game of war. The importance of being able to predict when the situation will inevitably result in violence is crucial to the success of this complex game.
One final example of how the game of Monopoly affects the game theory is the use of “tokens” or “payouts.” In many of the modern gambling games, including Texas Holdem, there is a limited range of possible outcomes, where winning can only be achieved by securing the most valuable token(s) and paying the corresponding fees. By contrast, in the game of Monopoly, players have a fixed number of available properties, which cannot be gained or used until the player has either paid all of the taxes required or purchased enough properties to make the bank balance complete.