With increasing improvements in software technology, new breakthroughs in the economic realm occur frequently. One such development manifests itself from the game theory—which exhibits calculated circumstances where a person’s success is based upon the choices of others. Essentially, by taking this conceptual basis and compounding it into an augmented digital format, a program can be developed to “guess” the actions of particular entities. The software’s versatility is almost immeasurable, with ranging capacities from settling divorce settlements to mediation between warring states.
For instance, Bruce Bueno de Mesquita of the Mesquita &Roundell consulting firm, was able to successfully predict that “Egypt’s president, Pervez Musharraf, would fall from power within a year” and that “Pakistan’s president, Pervez Musharraf, would leave office by the end of summer”. The computer model Mesquita uses functions by first assigning numerical values to the goals, motivations and influence of “players”. Then, the program considers the options available to the various players and determines their likely course of action. In this way, “game theory software played an important role in finding Osama bin Laden's hideout in Abbottabad, Pakistan”. Mesquita’s application of the game theory allows users to exploit a highly-structured methodology that churns out statistics of critical import.
Of course, forecasts can go astray when people give in to non-rational emotions, like hatred or guilt, rather than pursuing what seems to be currently in their best interests. Sorting out people’ motivations is much easier when making money is the main objective. Even so, these advancements in game theory have “picked up dramatically” and it has become apparent that forgoing utilization of such an analysis technique could demonstrate to be an exorbitant opportunity cost.
In a world where every favorable circumstance needs to be taken advantage of to move ahead, the game theory will inexorably prove to be an extremely helpful asset for solving a myriad of problems— with infinite implications for the future.
(Information taken from “Game Theory in Practice”, The Economist Technology Quarterly September 3rd 2011)
The technology that you are talking about seems both interesting and a little bit scary at the same time. A type of technology that can predict the moves of others based on their motivations and influences sounds like a very powerful tool. It sounds as if this tool could be extremely useful when it comes to predicting market interactions and could help a great deal of people better position themselves within the U.S. and global economy. However, such a tool sounds dangerous as well. While the hope would be that such types of technology would be used to help with future economic decisions possibly involving supply and demand among other things, there are other purposes that it sounds like one could use it for. Governments could use this type of technology to try and predict the movements of enemies and actions of other states. This new type of technology sounds neat but I would like to see how accurate its predictions are in the future.
ReplyDeleteI agree with Brock, this technology is extremely interesting, but also scary. What scares me the most about it though, is that it implies that humans don't necessarily have free will.
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