Demonstration against the European Central Bank in Thessaloniki, February 2015. Demotix/Giannis Papanikos. All rights reserved.Tony Curzon Price and Frances Coppola have presented compact summaries of a hypothetical game between Germany and Greece: two players, two moves, and a payoff matrix. The issue between them is the structure of the payoffs, and specifically whether the “hard/hard” outcome--namely “Grexit”--is favorable or disastrous for Greece.
Curzon Price is clearly right that the “game” is not “chicken.” It is not zero-sum. But is it a game? Both authors overlook the stricture of Greek Finance Minister Yanis Varoufakis in the New York Times three weeks ago. Varoufakis wrote: “...my game-theory background convinced me that it would be pure folly to think of the current deliberations between Greece and our partners as a bargaining game...”
In game theory the exact motivations of the players and structure of the payoffs are known. In the real world of Greece, Germany and Europe they are not. They are not playing for chips, points, or money. And this is not a two-person game, but one of shifting alliances between multiple entities with sometimes-congruent, sometimes-conflicting goals. It is more like the old board-game “Diplomacy”-- less a “game” than a set-up for underhanded betrayals--which I cordially loathed as a child.
