Game Theory Journal-2

Recently I’ve been planning my trip to San Francisco with my roommate, Abbey. She is a Korean girl studying English here, and she is leaving America on this trip. Our flight is on 11th Feburary, but we haven’t booked the hotel yet!

Last weekend we discussed about that. For a whole night, we looked up hotels around San Francisco downtown area, but we felt hard to decide. Now we’re still in this reluctantness to deal with the hotel booking.

This reminds me of coordination failure. Suppose the payoff that both of us check the hotels and we decide together is 4 for each of us. If one of us check the hotel booking and the other doesn’t even worry about this, the the careful one gets 1 and the other gets 3. Well, we can suppose that the payoff of us getting a hotel in this case is 3, which suggests the decision might not be so informed. And the responsible one gets minus 2 for her efforts in searching all the information online. Lastly, if neither of us cares about this thing, we’re going to be in a hurry and we will get 1 each.

Wait! This is not a prisoners’ dilemma! A brief analysis tells us that both players prefer checking out the hotels. What’s the problem then? The reason why we still cannot coordinate might be time is adequate for us, and neither us has realized that we will be better off to check out the hotels together and decide as soon as possible. Or it might be that the payoff of booking later in a hurry is higher, say, 2. In this case, the model is a prisoners’ dilemma, and neither of us will worry about the booking until the last minute.

I guess the most rational decision I should make is to talk with my roommate and let her know the importance of our coordination. This might serve as a contract to enable us get a better result.

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