combine is to risk a loss by a competitor’s c
ombination. (Antitrust laws have never beendefinitive enough to withstand this pressure against them.) In games such reasoning is whollydeductive, and it brings out the full implications of the basic assumptions.It is remarkable how closely their validity is confirmed by the experience of economic affairs. Anordinary game model for coalitions, showing in some respects how they form and re-form under
changing circumstances, is the card game “Set Back” a variation of pitch, played in the
mountains of northwest North Carolina.
It is an easier game to follow than von Neumann’s mathematical model, and with some
adjustments which will be indicated, it shows the basic idea of coalitions. Set Back is an auctiongame with bids up to five points (high, low, jack, joker, and a fifth point made by adding up thevalue of certain cards: ace (4), king (3), queen (2), jack and joker (1), and ten (10) ). The deal is
six cards to a player with a “widow” of five cards going to the successful bidder.
If you get the bid, you declare trumps and proceed to try to take the five points. Failing to makeyour bid, you are set back the amount of the bid. Eleven points take the game. With threeplayers, one generally gets ahead of the other two, threatening to go out from the vantage pointof six or more points. Immediately the other two players give each other tricks to keep themaway. from the advanced player, and the game is momentarily two against one.The crucial question for all coalitions then arises: how divide the coalition
’s gain between the
two members? The coalition must give itself tricks, on pain of giving the third player the game;enforcement of the coalition is thus clear and definite. Very soon, however, one of the coalitionmembers, profiting from the arrangement, will himself get six V points or more, and threaten totake the game. The first coalition instantly breaks up and the two strong players, fearing eachother, give tricks to the weak player to keep them away from each other.This suggests another unique aspect of coalitions, that under certain conditions weakness is not
a complete disadvantage. It does not follow therefore that under all circumstances the “fittest"
will survive. In economics this principle often takes the form of big organizations allowing orencouraging smaller ones to stay in business to maintain the minimum characteristics of thecompetitive situation so as to avoid various dangers of monopoly. In some industries today thatare dominated by a few companies it is a custom, almost approaching an ethic, to use kid gloves
in competi tion, and to speak well of one’s competitors.
Set Back is an inadequate model from the standpoint of the theory of games. In a true three-man game such as the mathematical model used, there is no sporting rule to prevent a playerfrom offering either of the others a payment to help him get out; since any player may do this,three possible coalitions compete for dominance. In this type of game, it is discovered that theprice of remaining in the coalition for any one player must be no less than the cost of defectionthat the opposed single player could pay to break the coalition. The result for a three-manmajority game is an equipoise of the contending forces brought about by the stress between thepossibilities of gain and threats of defection.