I may have to come back and read the entire post just to fully understand your position. That said, I have not been a big fan of using PD in a lot of analysis for a very key reason (though I only recently recognized the core of my disagreement with others.).
Note—the below is quickly written and I am sure has a lot of gaps that could be filled in or fleshed out.
As I learned the story, it was the jailer who actually constructed the payoffs to produce the incentives to defect. But that was because everyone knew the two stole the good but didn’t have good evidence to go to court. In other words, the PD was actually a sub-game in a larger social game setting where the defection in the PD game actually produced a superior equilibrium and outcome in the larger social game.
Putting in a bit of economic parlance, it is a partial equilibrium game that perhaps we don’t want to see achieve the best equilibrium for the market players (the “jailer” isn’t a player but observer).
So when we see something that looks like a PD problem seems to me the first thing to look into is what is constraining players to that payoff matrix—what is stopping the accused from talking to one another. Or perhaps more in line with your post, why have crooks not established a “never talk to cop” and “rats die” set of standards? In that case of real crooks those escapes of the PD are not really what we want from a social optimum but most of the time the PD is cast in a setting where we actually do want to escape the trap of the poor payoff structure.
For me it seems the focus is often misplaced because we’ve actually miscast the problem characterization as PD rather than some other coordination problem settings.
That seems like a quirk of the specific framing chosen for the typical thought experiment. There are plenty of analogous scenarios where there’s no third party who benefits if the players defect. Climate change in a world with only two countries, for example.
I may have to come back and read the entire post just to fully understand your position. That said, I have not been a big fan of using PD in a lot of analysis for a very key reason (though I only recently recognized the core of my disagreement with others.).
Note—the below is quickly written and I am sure has a lot of gaps that could be filled in or fleshed out.
As I learned the story, it was the jailer who actually constructed the payoffs to produce the incentives to defect. But that was because everyone knew the two stole the good but didn’t have good evidence to go to court. In other words, the PD was actually a sub-game in a larger social game setting where the defection in the PD game actually produced a superior equilibrium and outcome in the larger social game.
Putting in a bit of economic parlance, it is a partial equilibrium game that perhaps we don’t want to see achieve the best equilibrium for the market players (the “jailer” isn’t a player but observer).
So when we see something that looks like a PD problem seems to me the first thing to look into is what is constraining players to that payoff matrix—what is stopping the accused from talking to one another. Or perhaps more in line with your post, why have crooks not established a “never talk to cop” and “rats die” set of standards? In that case of real crooks those escapes of the PD are not really what we want from a social optimum but most of the time the PD is cast in a setting where we actually do want to escape the trap of the poor payoff structure.
For me it seems the focus is often misplaced because we’ve actually miscast the problem characterization as PD rather than some other coordination problem settings.
That seems like a quirk of the specific framing chosen for the typical thought experiment. There are plenty of analogous scenarios where there’s no third party who benefits if the players defect. Climate change in a world with only two countries, for example.