Hey Dad, why is the 2020 presidential election so noisy?
My boy, a 7th grader, asked me a simple question which took me 2 days to structure a proper answer to make him clear. It is really a joyful time for me to explain to the kiddo and now to write this simple piece down as a note for later use when he someday becomes a voter.
Yeah, it is just a little tricky game to play with, baby. Besides the perspectives of games organizing theory and making-any-move-a-good-profit concepts, there are basically three complexity levels of the whole story.
· Level 1. Voters level about the tragedy of the commons (Hardin, 1968)
People are debating and do not agree with some ancient economic believes in free or control in using natural resources, such as grazing areas or fisheries. I think most people who graduated from economics universities will advocate that a free market is always the best choice of efficiently using and developing resources, while others will advocate the control of the government, which means more tax.
· Level 2. Politics level about the prisoner’s dilemma (Dawes, 1973)
People are challenging each other the paradox that if it is impossible for rational creatures to cooperate on fundamental issues in ethics and political philosophy and threaten the foundations of the social sciences. Economics theories based on Pareto-optimal outcomes failed to work in the reality of all players choosing their best interest strategy.
· Level 3. Socioeconomics level about the approach beyond-markets-and-states (Ostrom, 2010)
The 2009 Nobel Laureate in economics proved that “at the heart of each of these [above levels] is the free-rider problem. Whenever one person cannot be excluded from the benefits that others provide, each person is motivated not to contribute to the joint effort, but to free-ride on the efforts of others. If all participants choose to free-ride, the collective benefit will not be produced. The temptation to free-ride, however, may dominate the decision process, and thus all will end up where no one wanted to be.”
So, what we see now with the outcomes of the election this year illustrates the three levels of the complexity of the whole story. As Plato said, “when there is an income tax, the just man will pay more and the unjust less on the same amount of income,” I hope the modern rational people will agree soon the necessity of being ‘Leviathan’ (as Hobbes said).
References:
Dawes, R. M. (1973). The Commons Dilemma Game: An N-Person Mixed-Motive Game with a Dominating Strategy for Defection. ORI Research Bulletin 13:1–12.
Hardin, G. (1968). The Tragedy of the Commons. Science 162:1243–8.
Ostrom, E. (2010). Beyond Markets and States: Polycentric Governance of Complex Economic Systems. The American Economic Review, 100(3), 641–672.
