Trump, Xi and Game Theory

M S S El Namaki

Abstract

Presidents Trump and Xi are approaching a game theory Nash construct. Both, predecessors included, have colluded into creating a race towards dominance of global trade, finance and technology. China by, primarily,  enhancing the consumption share of US GDP and America by feeding Chinese insatiable hunger for technology.  They created a dangerous measure of interdependence that translated into a mutually exclusive “win” situation.  The game would have continued unchallenged was it not for President Trump’s sudden realization that the probability of a win-win outcome is low. He then tampered with the underlying premises of the game and a new dynamic emerged. How will the game evolve? This will be the focus of the following article. The article applies an eclectic mix of conceptual frameworks including Game Theory, Nash equilibrium and Hofstede’ culture consequences, among others, in order to formulate a likely scenario.  It analytically places the two presidents within a Nash equilibrium prisoners’ dilemma framework with each considering his strategic moves while eying shadow moves by the other.

Keywords

Game Theory, Policy, Trade

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