Saturday, May 6, 2017

A Game-Theoretical Analysis Of The US-China-North Korea 'Standoff'

 

Zero Hedge



Via University of Maryland's Robert H. Smith School of Business,

Amid the ramped-up diplomatic and military pressure on North Korea, there is something else at play, says Charles E. Olson, professor of the practice at the University of Maryland's Robert H. Smith School of Business. It's an exercise in game theory.

Last weekend, as North Korea launched a ballistic missile, U.S. Secretary of State Rex Tillerson was at the United Nations, urging member nations to adopt new sanctions against North Korea for seeking to advance its nuclear ambitions despite repeated admonitions from the UN. And President Donald Trump was turning to Twitter to portray the latest launch – which exploded shortly after takeoff – as a provocation against North Korea's most important ally, China.

"This is a perfect game-theoretic situation," says Olson, who teaches in the logistics, business and public policy department and is director of the Business Honors Program. The central players are the United States, North Korea, China, South Korea, Japan and Russia.

Game theory is a wide-reaching study that can describe and model how human beings will behave, particularly in response to the actions of other human beings. It's a sort of chess-game thinking. 

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