The first comes from Eran Shmaya:
I heard this from Marco who heard it from Tzachi. Not sure what to make of it, but that will not deter me from ruminating publicly
There is a sack of chocolate and you have two options: either take one piece from the sack to yourself, or take three pieces which will be given to Dylan. Dylan also has two options: one pieces for himself or three to you. After you both made your choices independently each goes home with the amount of chocolate he collected.
The second from Presh Talwalker:
My friend Jamie is a professional poker player, and he came across a great example along the lines of the Prisoner’s Dilemma.
Here is what he reports:
I played a poker tournament at Caesar’s Palace last night with the
following setup: The buy-in is $65, which gets you 2500 chips. There
is also the option to buy an additional 500 chips for $5 more, giving
you a total of 3000 chips for $70. At 1 cent/chip, this add-on sounds
like a great bargain compared to the 2.6 cents/chip of the regular
The kicker is that the house keeps the entire $5 add-on fee; none of
it goes into the prize pool.
Each of these is equivalent to a Prisoners’ Dilemma. That should be obvious in the first case. In the second case, notice that if you buy the additional chips you deflate the value of the others’ chips. (Poker seignorage!) If you were to present either of these examples to students, I would bet that most of them would play the corresponding Defect strategy. And this would make for a great teaching device if you show it to them before teaching the Prisoners’ dilemma. Because the usual framing of the prisoner’s dilemma suggests to students that they ought to be cooperative. This is the main reason students are often confused by the Prisoners’ dilemma.