Game theory in the popular press.


Game theory and economics in the news

August 18, 2006 Ventura County Star, Health plan for small firms to shut down
Insurers participating in pooled-employer programs lose money, possibly due to adverse selection, as high-risk employees are more likely to select certain plans. (by Allison Bruce)
August 8, 2006 The Korea Times, Things to Check Before Buying Homes in US
New regulations encourage Korean citizens to purchase homes in the US, but information asymmetry and adverse selection require caution -- a simple tale of the lemons problem applied to homes. (by Chang Se-moon)
May 18, 2005 CBS News, Listen to the children
Major auction houses forced to play rock-paper-scissors over rights to auction eccentric millionaire's art. "Sotheby's decided to leave its decision to chance, and had no particular strategy." (by Lloyd Garver)
April 29, 2005 Financial Times, Jungle Theories
A rather scathing review of Paul Omerod's "Why Things Fail" which includes references to bounded rationality and evolutionary game theory in explaining business failures. (by Paul Ormerod)
April 29, 2005 New York Times, Rock, Paper, Payoff: Child's Play Wins Auction House an Art Sale
Major auction houses forced to play rock-paper-scissors over rights to auction eccentric millionaire's art. "Sotheby's decided to leave its decision to chance, and had no particular strategy." (by Carol Vogel)
February 2005 Fast Company, You got game theory!
A somewhat disingenuous critique of game theory in which the author finds that no academic game theorist can provide concrete examples of game theory used by businesses. (by Martin Kihn)
April 1, 2004 Mercury News, Wages are key to offshoring
Argues that outsourcing of American jobs is a tragedy of the commons in which each company raises its profits but leads to less purchasing power at home.
2004 Auction World, The winner's curse
A leading auctioneer discusses the winner's curse, reflecting industry experience but only a vague, rudimentary view of auction theory (by Deb Weidenhamer)
November 11, 2003 The Register, Oracle chokes on PeopleSoft's poison pill
Strategic commitment highlighted through a poision pill provision, creating an additional $800 million cost to be assumed by Oracle in case of a takeover.
October 9, 2003 The Economist, Fat Cats Feeding
Discusses trends in executive incentive pay in light of recent scandals.
October 6, 2003 Newsweek, An experimental mind
Highlights Vernon Smith's contributions to behavioral economics and notes how the field is finding new applications.
August 7, 2003 TechNewsWorld, Neural-network technology moves into the mainstream
Notes how several companies combine neural networks with game theory to create software to mine consumer data and create targeted campaigns.
May 30, 2003 Business Week, The Jobs Wizard of Wharton?
New director of career services at Wharton uses game theory for optimal interview scheduling.
March 30, 2003 Cincinnati Enquirer, How smart is it to be trusting?
Being trusting in business is not naive but an optimal way to play repeated prisoner's dilemmas according to Axelrod's findings.
February 16, 2003 Cariocas Press Release, Cariocas raises $5.25 million in second-round funding
Marketing firm creates customer loyalty and retention products through applications of game theory.
January 31, 2003 Wall Street Journal, Ford, GM escalate price war with latest rebates for SUVs
Price wars continue in the prisoner's dilemma of automotive pricing.
January 9, 2003 Washington Post, Finding shelter with Uncle Sam
Companies increasingly use incentive pay to shift profit risks to employees.
December 6, 2002 Disinformation, The art of mega deals
Rupert Murdoch's success in business is partly the result of "understanding how game theory shaped deal negotiations and inter-firm competition" (by Alex Burns)
November 17, 2002 San Francisco Chronicle, Key Enron energy trader excelled at power game
Timothy Belden, at the center of the Enron scandal, studied game theory at Berkeley.
October 31, 2002 The Economist, Setting the trap
Applauds U.S.-style antitrust laws that provide immunity to cartel members who come forward as a "clever use of game theory" creating a race to cooperate.
July 30, 2002 Forbes, How to salvage stock options
How stock option bonuses can align incentives of shareholders and executives.
July 30, 2002 Miami Herald, Market decline reveals hazards
Stock options create a moral hazard, incentives for short-term stock price spikes.
July 30, 2002 Financial Times, In search of self-interest
Considers whether historical figures in politics and business satisfy the assumptions of homo economicus, and notes that the definition is quite similar to that of a sociopath. (by John Kay)
July 29, 2002 InfoWorld, Incentive Systems announces name change, new EIM suite
Discusses the rising business of software for managing incentive pay of sales forces.
April 1, 2002 Entrepeneur Magazine, The Art of (Price) War
Price wars are often not sustainable and value-pricing may be a better proposition.
March 18, 2002 Business Week, Game theory's hidden holes
Disequilibrium play in the traveler's dilemma and games with mixed strategies
February 9, 2002 CNet, Partners today, rivals tomorrow
Notes the need to consider strategic moves by current partners, including post-contractual hold up and moral hazard.
December 21, 2001, Notes on the economics of game theory
Provides extensive introduction to game theory and argues that Eastern Europeans view business culture as a zero-sum game.
November 22, 2001 The Guardian, EC fines 'Vitamin Inc' cartel
Cooperation among European vitamin manufacturers deemed collusive.
June 1, 2001 CFO Magazine, Building a better carrot
Companies struggle with moral hazard and offer incentive pay to even lower-level employees.
February 8, 2001 USA Today, Cruise lines draw profits from selling works of art
How the excitement of art auctions at sea leads participants to overbid and overpay.
2001 Technology Acquisition Update, Negotiating when value is not tangible
Provides a guide to negotiation in low-information environments, and notes the role of perception.
October 18, 2000 CNET News, Revenue-sharing contracts boost supply chain performance
Blockbuster experience highlights greater profits from negotiating revenue sharing arrangements in the supply chain.
July 12, 2000 Financial Times, Beauty and the bidder
Auctions are useful market allocation mechanisms when the reward is mostly monetary, but do poorly when the prize is of psychological value. (by John Kay)
June 19, 2000 eeTimes, Bill Gates could gain a lot from a little game theory
Discusses tit-for-tat as an optimal strategy in repeated games
June 1, 2000, The 2000 compensation survey: Riding the bull
Stock options reward executives when prices rise but this does not mean incentives are aligned.
April 14, 1999 Financial Times, Playing chicken can clip one's wings
Describes how the game of chicken applies not only to film versions of teenage angst, but also to common business situations. (by John Kay)
October 1, 1998 Fast Company, Decisions, decisions
Famous people describe their decision-making paradigms
July 1, 1998 Business Week, Game theory wasn't meant to be a forecasting tool
A brief letter on game theory 's use in business to model interactive decision-making.
March 14, 1997 Financial Times, Lemon economics
Only recently have economists provided explanations for the existence of advertising. It may be informative, reducing the lemons problem, or a commitment device, by "burning money." (by John Kay)
November 18, 1996 Wall Street Journal, Even a losing bid can pay off
Examines strategic moves that result in other participants paying you to play the game.
September 1, 1996 Business 2.0, Business as a war game
Bell Atlantic Chairman explains use of game theory in modern management
May 1, 1996 MAA Online, The five percent solution
Reflections on the role of math and game theory in business
January 25, 1996 Investor's Business Daily, Let Game Theory Begin: Anticipating Your Rival
Discusses the role of game theory in business
April 1, 1983 The Freeman, Free riders face a rocky road
Argues that even though employees free ride on union power by receiving benefits without being members, this is a valid check on union power.