Game theory – Europe

 

Thinking about this situation in terms of game theory isn’t terribly illuminating. The academic discipline that goes by the name is a branch of mathematics founded in the interwar years by the brilliant polymath John von Neumann, who was also involved at Los Alamos in the construction of the first atomic bomb. According to Neumann’s theory, human beings make rational choices aiming to achieve results that are best for each of them. Applied in the context of the post-war nuclear stand-off, the theory produced “mutually assured destruction” – the balance of terror that has prevented full-scale war between nuclear-armed states. It has also been applied widely in economics and business management, and with some success.
The trouble with game theory is that it assumes human action is essentially strategic or instrumental in nature – in other words, that humans act in order to achieve some definite result or pay-off. In many situations this model fits reasonably well. It can be useful in thinking about how to get a pay rise, or bargain for a lower price when buying something you want. Politicians often apply game-theoretic strategies in their dealings with opponents, by presenting them with policy options that reveal their vulnerabilities, for example. Game theory can also be useful in military situations – not only nuclear stand-offs, but also in identifying targets of terrorist activity and computing the optimal paths of missiles.

applications 300x232 Game theory   Europe Romano Pisciotti
Europe and USA compare Games and strategies

But not all of human behaviour fits a model of strategic reasoning. We humans don’t act only in order to bring about results. We also act to express ourselves, to show the kind of human being we are or want to be. Behaviour of this expressive kind can be admirable and noble. It would be difficult to come up with compelling strategic reasons for Winston Churchill’s decision to lead Britain in fighting on against Nazism in May 1940. Churchill may have thought that Britain would be better off being defeated, even in strategic terms, than it would be if it reached some sort of compromise with Germany, since there was little reason to believe that Hitler would keep to the terms of any deal. But the real reason for Churchill’s decision was a conception of civilisation that precluded a shameful peace with the worst sort of barbarism. Fighting on was better, even if the consequence could be known in advance to be certain defeat.
Acting without regard to consequences is part of what it means to be human. By acting in this way we give meaning to our lives. But this human trait becomes dangerous when leaders pursue a project that not only can’t succeed, but is destroyed by the very process of trying to achieve it. The euro is one such project. It was known in advance that it couldn’t work. To go on with the project isn’t simply to compound the error that was made when the currency was set up. It’s an act of folly.
Having identified themselves with an unrealisable project, European leaders are committed to pursuing it to the bitter end. It’s not just their reputation and pensions that are at stake. The euro embodies a vision of an ideal Europe that has become part of the meaning of their lives. Conceived in the aftermath of World War Two, the European Union was meant as a way of leaving behind forever the conflicts between nation-states that had wracked the continent in the past. The paradox is that by pursuing this dream, Europe’s elites have locked themselves into a project that can only deepen Europe’s divisions and inflame the forces of nationalism.

John von Neumann 1903-1957

Born in Hungary, von Neumann was one of the world’s foremost mathematicians by his mid-20s
Pioneered game theory and was one of the conceptual inventors of the stored-program digital computer, alongside Alan Turing and Claude Shannon
Also performed pivotal work on quantum theory and the atomic bomb
Encyclopedia Britannica: John von Neumann

INTERESTING LINKS
HOW THE GAME THEORY WORKS – INTERACTIVE GAMES ONLINE

www.gametheory.net/html/applets.html
BIMATRIX GAMES SOLVER

http://banach.lse.ac.uk/form.html (arbitrary number of strategies)
MATRIX GAMES SOLVER

http://banach.lse.ac.uk/form.html (at most 5×5 strategies)
REPEATED PRISONER DILEMMA

http://www.lifl.fr/IPD/ipd.html.en

Repeated games of two players (for various strategies combinations):

http://www.lifl.fr/IPD/applet-match.html.en

Tournament (number scores of various strategies):
http://www.lifl.fr/IPD/applet-tournament.html.en

The evolution of a population with strategies in question:
http://www.lifl.fr/IPD/applet-evolution.html.en

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China devalues yuan currency to three-year low

84808855 chinagetty 457951404 300x169 China devalues yuan currency to three year low Romano Pisciotti

 

China’s central bank has devalued the national currency, the yuan, to its lowest rate against the US dollar in almost three years.

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yuan

 

The lender said the move was a “one-off depreciation” of 1.9% in a move to make the exchange rate more market-oriented.

 

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Segnalato Romano Pisciotti China devalues yuan currency to three year low Romano Pisciotti
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The first cargo ships passed through Egypt’s New Suez Canal

The first cargo ships passed through Egypt’s New Suez Canal on Saturday in a test-run before it opens next month, state media reported, 11 months after the army began constructing the $8 billion canal alongside the existing 145-year-old Suez Canal.

suez cana 1dcrxq 300x200 The first cargo ships passed through Egypts New Suez Canal Romano Pisciotti
new suez canal

The new waterway, which President Abdel Fattah al-Sisi hopes will help expand trade along the fastest shipping route between Europe and Asia and give a boost to Egypt’s economy, will be formally inaugurated on Aug. 6.

Sisi wants the canal to become a symbol of national pride and to help combat Egypt’s double-digit unemployment. The old Suez Canal is already a vital source of hard currency for Egypt, which has seen tourism and foreign investment drain away in the years of turmoil since a 2011 uprising.

Three container ships crossed the new waterway, state news agency MENA reported. One was an American ship heading to Egypt’s Port Said from Saudi Arabia, another was a Danish ship sailing to the United States from Singapore, and a Bahraini ship going to Italy from Saudi Arabia.

The exercise took place amid tight security. An insurgency based in the Sinai Peninsula, which borders on the Suez Canal, has killed hundreds of soldiers and police since 2013. State television said there were helicopters circling above and showed naval vessels escorting the ships.

Mohab Mameesh, the chairman of the Suez Canal Authority who led the project, told state television from aboard the first ship that the test-run had been a success.

“This is the first trial crossing but it will be followed by more trials,” he said. “We are 99.2 percent done with everything. We should be completely done in two or three days.”

The existing canal earns Egypt around $5 billion per year. The new canal, which will allow two-way traffic of larger ships, is supposed to increase revenues by 2023 to $15 billion.

It should also reduce navigation time for ships to 11 hours from about 22 hours, Mameesh said last month, making it the fastest such waterway in the world.

The government also plans to build an international industrial and logistics hub nearby that it hopes will eventually make up about a third of the Egyptian economy. (Reporting by Omar Fahmy and Yusri Mohamed; Writing by Ahmed Aboulenein; Editing by Raissa Kasolowsky)

Jul 25, 2015

 

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