Jumanji and The Government’s Take on Game Theory

Jumanji and the Government Take on Game Theory

By: Sophie Torosyan

Word Count: 565 words

 

Enticed by a cryptic game called “Jumanji” in which the game pieces move themselves according to the roll of the dice, Judy and Peter are sucked into another dimension in which the only way to survive is by making the “right decision.” As the game progresses, the two protagonists realize that the only way for them to return home is by making choices towards a common goal, rather than each player acting in his/her best interest. This is the moment when they win the game and are given the opportunity to reverse the negative consequences of their actions, their reward for collaborating within their community. By portraying how a strategy can help our decisions lead to an optimal outcome, Jumanji demonstrates how game theory applies to human behavior, thought processes, and interaction among groups. The studies of psychology and economics show how rational thought connects to the formation of strategies which impact individual consumers who then influence market outcomes.

Rational decision-making involves making choices that will achieve outcomes aligned with one’s personal goals and objectives. In other words, rational thought will lead an individual to achieve the greatest benefit and satisfaction given their available choices. This relates to game theory, which studies how the interacting choices of economic preference produce outcomes according to optimal utility. 

Game theory conceives social situations and decision-making in the format of players, who evaluate the information given to create strategies according to their future individual payoff. However, game theory does not emphasize the importance of one player’s decisions on another’s payoff, which distorts and often hinders equilibrium, or a mutually beneficial outcome, from being reached. In Jumanji, if each player acted individually, without considering or collaborating with others to develop a common strategy, the players would not be able to escape the game and return home. 

In Jumanji’s game theory, both players’ future benefits from the game are contingent upon one another. This style of game theory can be successfully utilized in the sale of goods and services, analyzing the stock market, developing marketing strategies, and global trade. By studying consumers’ rational strategies, economists and business owners can better predict behavior, find ways to target their consumers, and stimulate or deflate expenditure. The game theory also influences how the government acts to counter recessions and inflations. During a recession, the government will employ expansionary fiscal policies, in which taxes are cut and government spending is increased in order to grow consumer spending and business investment, which snowballs to expand aggregate demand, GDP, price level, and employment. To counteract inflation, the government will utilize contractionary policies such as increasing taxes and decreasing government spending to lessen consumer spending and business investment, which will cause aggregate demand, GDP, price level, and employment all to decrease. By utilizing game theory, the government can implement successful changes in assuming that individuals and firms will make rational decisions to benefit their own favorable outcomes. Jumanji’s game theory illustrates the importance of community-oriented thinking and the impact one individual has on another, which can increase the likelihood that consumers will be able to predict the stabilizing changes the government plans to implement before they are put into effect. 

In our ever changing global world, Jumanji-style game theory can help us better understand how to develop economic and fiscal policies that are sustainable and impactful to each country and community. How about taking a break to play Jumanji?

 

References: 

Garcia, Cardiff. “How Stories Shape The Economy.” NPR, NPR, 16 Oct. 2019, www.npr.org/2019/10/16/770686962/how-stories-shape-the-economy.

Hayes, Adam. “How Game Theory Works.” Investopedia, Investopedia, 30 Aug. 2019, www.investopedia.com/terms/g/gametheory.asp.

Ross, Don. “Game Theory.” Stanford Encyclopedia of Philosophy, Stanford University, 8 Mar. 2019, plato.stanford.edu/entries/game-theory/.

 

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