Games Of Life - Part 1: The Broad Lines

Gaming theory is an interesting field of study that has been at numerous time applied to human life. Several gaming types where applied on real-life with different degrees of success. For example, Poker (a gambling game of cards) has been used several times to study tactical operations in war for military purposes. Yet, later it was proved that Poker is not a good model for war tactics regardless of how strong the analogy might be.

Poker obviously cannot be applied to war tactics (or any other aspect of life) due it being a zero-sum game: Life, and especially war, is not a zero-sum game, and modeling it as such is necessarily flawed logic! Sure you might ask what does "zero-sum game" mean...

Games can be divided into several categories according to certain properties. Some games are zero-sum others are non-zero-sum. Some games are games of perfect-information others are games of imperfect information.

Zero-Sum Games:
A zero-sum game is a game where one's gain is another's loss, and someone's loss is another's gain. Consider a game of chess: If one side wins, the other must lose. They cannot both win! There is no win-win situation in a game of chess! Same goes for poker, if someone wins 10$, then someone else must have lost 10$!! If we consider winning 10$ as +10, and losing 10$ as -10, then the sum of it all is ZERO... Thats why they call it a zero-sum game!
This applies to two-player games as well as multi-player games where applicable. Games of zero-sum always adds up to zero for all the players involved.
Life is obviously not a zero-sum game. There are a few win-win situations, but the most dominant situation is loss-loss. Consider the case of a war: Say a country is worth 1 million points, and each person is worth 1 point. Now assume that country A attacked country B, and a war happened that cause 1000 deaths in country A and 2000 deaths in country B, and finally country A took country B. In this hypothesized situation, country A has won 1 million points and lost 1000 points, giving a net of (+999000). Obviously country A has won something. On the other hand, country B has lost 1 million points and 2000 points, giving a net of (-1001000). Adding up the points of both countries the sum is (-3000). It did not add up to ZERO, because certain losses have irrecoverably vanished. So this hypothesized war is a losing game, or in other words a negative-sum game. On the other hand, sex can be though of as a positive-sum game, as both players in that game are satisfied.

Games of Perfect Information:
Chess is a classical example of a game of perfect information. The state of the game is well-known to both players. No player has anymore information than the other. Everything is laid-out in the clear. All possibilities are deductible.
(Most) Card games are games of imperfect information. In a typical four-players card games, one player has information about his set of cards, while having absolutely no idea about the cards of the other three players. This obviously turns the game into a game of imperfect information.
Life can be modeled as a game of imperfect information. Assuming that humans are players in the game of life, we can find that most of the time a player has no knowledge of all the variables that influence the outcome of the game.The element of surprise is dominant.

Games of Chance:
Monopoly is a classical example of a game of chance. Unlike card games, all the players have equal knowledge of the state of the game. No-information is hidden from any of the players, except the output of the dice, which none of the players know in advance. The game consists of what game theory experts call "chance nodes" and "decision nodes"... A chance node is simply the moment of throwing the dice, whose outcome is probabilistically modeled. A decision node is the moment one (or more) of the players have to make a decision that will change the state of the game.
Also, unlike chess, although players have full knowledge of the state of the game, they have no power to influence the outcome of the game assuming perfect play by all the players.

Games of chance might include the element of imperfect information. Texas-Holdem poker is such an example. In Texas Holdem poker, each player has information about his own cards and not other players just like games of imperfect information. But in addition to that, there are chance nodes where cards are revealed in a probabilistic manner. Bets made by players are the decision nodes.

Life can be modeled as a game of chance with imperfect information. So all-in all, life can be modeled as a game of chance with imperfect information and non-zero-sum! Numerous other factors can be taken into consideration to refine the model of life as a game.

In this series:
Games Of Life - Part 1: The Broad Lines
Games Of Life - Part 2: Equilibrium
Next: Games Of Life - Part 3: Games Of Non-Zero-Sum
Next: Games Of Life - Part 4: Advanced Insight Into Games Of Perfect Information
Next: Games Of Life - Part 5: Gaming Theory And Decision-Making Theory