APPLICATION OF GAME

THEORY IN STAG HUNT

BY
TANMAY NAYAK
A016
THE STAG HUNT

• In game theory, the stag hunt, sometimes referred to as

the assurance game, trust dilemma or common interest
game, describes a conflict between safety and social
cooperation. The stag hunt problem originated with
philosopher Jean-Jacques Rousse (1712-1778) in
his Discourse on Inequality.
THE GAME
•  In Rousseau's telling, two hunters must decide separately, and without the
other knowing, whether to hunt a stag or a hare. However, both hunters
know the only way to successfully hunt a stag is with the other's help. One
hunter can catch a hare alone with less effort and less time, but it is worth
far less than a stag and has much less meat. Thus, this implies that it would
be much better for each hunter, acting individually, to give up total
autonomy and minimal risk, which brings only the small reward of the hare.
Instead, each hunter should separately choose the more ambitious and far
more rewarding goal of getting the stag, thereby giving up some autonomy
in exchange for the other hunter's cooperation and added might. The
following payoff matrix for this game looks something like this:
PAYOFF MATRIX FOR STAG HUNT
Hunter B’s Decision

Hunter A’s decision Stag Hare

Stag A:3 A:0

B:3 B:2

Hare A:2 A:1

B:0 B:1
• If we use the dominance strategy, we can see that if
Hunter B is going to hunt a stag, Hunter A will also
choose to hunt a stag as, aforementioned in the payoff
matrix, 3 is greater than 2, and if Hunter B choses to
hunt a hare, then Hunter A hunt down the other hare
as well since 1 is greater than 0, so sometimes Hunter A
prefers hunting a stag and sometimes they will prefer
hunting a hare, thus the dominance strategy is not
sufficient for this game. Hence we introduce a new
concept, namely called as Nash Equilibrium.
NASH EQUILIBRIUM
• A game is said to be in Nash Equilibrium when no
player has incentive to deviate from his strategy
given the strategies all the players are playing. In
simple words, everyone is playing their own best
response to what all others are doing. There exists
atleast one Nash Equilibrium in all finite games.
• To find a Nash Equilibrium we have to take an outcome and check
to see if any of the players would like to change their strategy
given what the other one is doing and in this case we have four
strategies:

• Stag-Stag
• Hare-Stag
• Stag-Hare
• Hare-Hare
• In the Stag-Stag outcome, it can be seen that Hunter A will hunt
the stag given Hunter B is hunting a stag. Hunter A would not want
to deviate as hunting a stag is his best response when Hunter B is
stag hunting as well. Now let’s look what would Hunter B do given
Hunter A is hunting a stag. From the payoff matrix, it is evident
that Hunter B would also want to hunt the stag because 3 is
greater than 2, or we can say that he would not want to deviate
from hunting a stag as stag gives the hunter more meat than the
hare, so Stag-Stag becomes a Nash Equilibrium. Now we would
want to check if there are other Nash Equilibria present in the
payoff matrix so we check the rest of the outcomes.
• So let’s look at the Hare-Stag outcome, that is hunter B hunting a
stag and hunter A hunting a hare, so again we have to ask if either
hunter wants to change their strategy given what the other one is
currently doing and we can see that hunter B would want to
change their strategy and the fact that the best response to hunter
A hare hunting is to hare hunt as well because, as seen in the
matrix, if hunter A is hare hunting then there is no benefit of
hunter B doing a stag hunt since there is no scope for cooperation
and teamwork, so they will want to deviate and choose to go get a
hare instead so hare-stag is not in equilibrium. Now, by the similar
logic, stag-hare outcome is also not in equilibrium.
• Now that leaves us with the last outcome that is hare-hare outcome,
we can see that if both players are hunting a hare, it would make no
sense in deviating from their respective strategies because if either one
goes stag hunting, they will not get to hunt a stag all by themselves, so
since none of the hunters are choosing to deviate from their original
strategy, that is hare hunting, this strategy is also a Nash Equilibrium.
• Therefore, we have found two Nash equilibria where both hunters hunt a
stag and both hunt a hare. The stag-stag strategy looked more obvious
whereas the hare-hare strategy looks more counter-intuitive because
this is worse for both players than if they both collectively chose to hunt
a stag. However, if they’re unable to coordinate like this, then it sets this
expectation in their mind that both are going to be hunting a hare and so
this guarantees that they’re going to be doing something better when
they’re hunting hares and as a result it can trap both hunters into an
inefficient situation where they’re both hunting hares instead of getting
a stag, so Nash Equilibrium isn’t always efficient and good but they are
inherently stable and no one has any regrets hunting hares in this
particular case, given that the other one is going to do the same thing.
THANK YOU