Wednesday, August 14, 2013

Australia's 2013 Election is a Prisoner's Dilemma

Tl;dr: Either Tony Abbott reneges on his plan to give preferences to the Australian Labor Party ahead of the Australian Greens, or Labor wins the election easily.

The prisoner's dilemma is a situation that is defined by 4 outcomes, based on 2 players choosing to cooperate, or screw each other:

  1. Both cooperate, in which case, they each get a mild penalty
  2. One screws the other, in which case the screwer gets no penalty, and the screwee gets a large penalty
  3. Like 2, but swapping who does the screwing
  4. They each screw the other, and each get a moderate penalty.
In terms of this election, penalties need to be inverted into rewards, where smaller penalties correspond to bigger rewards.

Here's the prisoner's dilemma for the election:
  1. Liberal and Labor preference each other ahead of the Greens, causing one, effectively at random, to win the election outright.
  2. Liberal preferences Labor, but not vice versa, causing Labor a guaranteed win.
  3. Labor preferences Liberal, but not vice versa, causing Liberal a guaranteed win. 
  4. They each preference the Greens ahead of each other, creating a large chance of a hung parliament, forcing either negotiations with cross-benchers, which they have eached refused to do, or a new election.
Obviously, from the objective observer's point of view, option 1 should be chosen, but from the participant's point of view, screwing over is the best option if it can't be guaranteed that the other party with cooperate, especially if the stakes are high.

So while Liberal is talking about preferencing the Greens ahead of Labor, I think this will only happen if their public announcement is enough of an impediment to stop them going back on it. Having announced their intention, Labor can sit back and win the election, particularly control of the Senate where most people cannot be bothered voting below the line, so it would be best for Liberal to not preference Labor ahead of the Greens. If Liberal induces Labor to make the same commitment, then it would also be in Liberal's best interests to go back on their announcement, as the election would come to them. This is why the dilemma is unstable, as non-cooperation is always best in a one-off encounter. The main question is really whether elections, every 3 years, often with different leaders, offer enough consistency to form the basis of an iterated prisoner's dilemma where cooperation can pay off. I don't think it does.

This will be interesting either way. Either Liberal doesn't follow through with their preferencing plan, or they throw away the election.

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