What are some real-life examples of the prisoner's dilemma?

What are some real-life examples of the prisoner's dilemma?

One classic example is the arms race between two countries, where both sides would benefit from disarmament but fear being at a disadvantage.

Can you explain how it applies to business competition?

Sure! In business, companies may face a dilemma when deciding whether to lower prices. If both lower prices, they both lose profit, but if one lowers prices while the other doesn't, the one who lowers prices gains market share.

Are there any examples in everyday life?

Yes! A common example is when two friends decide whether to keep a secret. If both keep it, they maintain trust, but if one tells, they gain social advantage at the other's expense.

How can understanding this dilemma help in decision-making?

Understanding the prisoner's dilemma can help individuals and organizations recognize the importance of cooperation and the potential consequences of their choices.