What would you do in the prisoner's dilemma

To grant trust and to react correctly to received trust, every person - like many other things - has to learn in the course of his life. Without experience with personal trust, there can hardly be trust in other people or in other organizations. The ability to give and justify trust is a very personal experience based on personal life experience. Demanding trust or even creating it retrospectively seems to be an impossibility.

Trust, seen as an expectation, is always associated with the risk of disappointment and thus of loss. At the beginning of a relationship of trust (e.g. law firm owner - employee, client - employee, etc.), there must always be a "leap of faith" that can easily be lost.

So what should induce people to voluntarily put themselves in the position of potential losers? Despite the possible prospect of losing the leap of faith, what compelling reasons could there be for opting for a strategy of trust?

The situation in which people are faced with the very decision of this problem is described in the scientific literature as the iterated prisoner's dilemma. Even if you now believe that, as a tax advisor, I have nothing to do with prisoners (although that too can go faster than you think - see the latest accounting scandals), please read on anyway.

The situation

The prisoner's dilemma describes the classic two-person non-zero-sum game. It is possible for both persons involved to derive mutual benefits or profits from trusting the other. It is also possible that one of them exploits the other, or that neither of the two people involved puts their trust in the other, out of the idea of ‚Äč‚Äčlosing out themselves.

The prisoner's dilemma derives its structure from the American leniency program: the public prosecutor's office offers two prisoners who are suspected of having committed a crime together, each to be released separately if they confess the crime. The incriminated prisoner would have to go to prison for 12 years. Should both remain silent, however, based on circumstantial evidence, a prison sentence for 5 years each would result. If both prisoners confessed, both prisoners would have to go to prison for 8 years.

That means that each of the prisoners has two options to decide: to remain silent or to confess. Or, from the prisoner's point of view, to trust the loyalty of the accomplice or, conversely, to start a cooperation with the public prosecutor. Both know the consequences of their actions. However, everyone has to make their choice without knowing how the other will behave.

The following matrix shows the possible combinations of decision options:

Prisoner B silence

Prisoner B Confess

Prisoner A silence

5 years / 5 years

12 years / 0 years

Prisoner A Confess

0 years / 12 years

8 years / 8 years

Matrix for the prisoner's dilemma

The real dilemma is that regardless of the behavior of the other, the strategy of breaking trust in the former accomplice (partner) appears to be the only sensible one, i.e. the safest strategy for both prisoners, although both lose and only achieve a suboptimal result can (8 years in prison).

Let us assume that prisoner A comes to the point in his deliberations that silence would be the most sensible of all possible choices for him. He would only make this decision if he could trust that his accomplice would also behave in the same way (prisoner A / silence, prisoner B / silence: both 5 years in prison). But what if the accomplice is not silent? (Prisoner A / silence, prisoner B / confession: A 12 years imprisonment, B 0 years imprisonment). Conversely, how will the accomplice rate his trust?

A relationship dilemma arises that cannot be resolved with rational considerations. Because - whenever - in the sense of maximizing one's own interests, the "most sensible" solution has been found, an even more sensible one imposes itself upon further rational considerations. A dead end, then, which allows the conclusion that rational logic and trust are incompatible.

These considerations turn out to be more than just theoretical. Rather, they can be read as the "most elegant" abstraction of relationship problems. Many interpersonal conflict situations, from personal to business relationships, can be viewed as such a repetitive prisoner's dilemma.

But what is a good strategy in this situation? How to behave How often does it make sense to trust the other when the other could unscrupulously abuse this trust or only wanted to maximize his or her self-interest? When does it make sense for me to stop responding in a friendly and trusting manner in order to achieve an optimal result?

The mathematician Robert Axelrod tried to answer precisely these questions with the help of game theory.

Games ... you will think, no, as a tax advisor, I really have nothing to do with that. But don't worry, game theory is a serious, serious philosophy of science. Allow me to ask you to read on again.

Game theory generally examines the interactive strategies of individuals who have opposing or overlapping interests. The results can by no means only be applied to "games" in the narrower sense, but are demonstrably valid for the real behavior of people in comparable decision-making situations.

Robert Axelrod invited experts from different scientific disciplines to submit computer programs for strategic games and thus to take part in a competition. (Robert Axelrod: "The evolution of cooperation" published by R. Oldenburg Verlag, 2000)

The result was amazing. It won the simplest program, namely TIT FOR TAT, submitted by Canadian psychologist Anatol Rapoport. TIT FOR TAT ("Like you me, like me you") is a friendly game strategy. It begins with the "leap of faith" mentioned at the beginning and the offer of cooperation. Then she does what the other player did on the previous move.

"What makes the robust success of TIT FOR TAT is the combination of being friendly, fighting back, exercising forbearance and being understandable. Kindness protects against unnecessary trouble. Striking back keeps the other side after an attempted defect (addition: he means non-cooperation. ) refrain from continuing this undeterred. Forbearance is helpful in restoring mutual cooperation. Finally, comprehensibility facilitates identification and thus triggers long-term cooperation. " (The evolution of cooperation, p.48)

It's all just theory ... do you think? Axelrod illustrates the development of cooperation and mutual trust on the basis of TIT FOR TAT with a very impressive example that took place under the worst possible conditions during the trench warfare of the First World War:

Without ever having said a word about it, the enemy soldiers held breaks in combat during mealtimes. A "live and let live" system had developed. This happened against the military logic of killing and being killed and despite attempts by senior officers to prevent this.

Axelrod deduced from the fact that if trust can develop even among enemies, the TIT FOR TAT strategy contains generally applicable rules that are very likely to be very promising under the most varied of conditions.

From his extensive investigations, he derives four simple behavioral suggestions that you can take into account when managing employees on a daily basis.

1. "Don't be jealous."
2. "Don't be the first to defect."
3. "Return both cooperation and non-cooperation."
4. "Don't be too clever."

1. "Don't be jealous"

The comparison with the success of the other (competitor, business partner, entrepreneur ...) unfortunately often triggers feelings of envy. This envy often leads to attempts to correct the other's advantage. In relationships, this is possible by breaking off cooperation. However, termination of the cooperation leads to mutual losses. Envy is therefore inevitably self-destructive. TIT FOR TAT as a strategy, on the other hand, triggers behavior that enables both partners involved to do well. The success of the other is practically always the prerequisite for one's own success. Who should want to prevent this?

2. "Don't be the first to defect."

It is reliably worthwhile to cooperate as long as the other person does too. Friendliness always pays off. It also avoids unnecessary conflicts. Ending a good relationship would mean that in the long term it would destroy the basis of one's own success.

3. "Return both cooperation and non-cooperation."

Follow the principle of reciprocity. Return the trust you have placed in you, but be equally careful not to be freely exploited. TIT FOR TAT - "As you me, so I you". Forbearance makes it easier to re-establish a basis of trust and cooperation after any abuse.

4. "Don't be too clever."

A strategy that can be understood by everyone inspires trust and downright encourages cooperation. When you use a strategy like TIT FOR TAT, your future behavior becomes predictable. The other can easily see that the best way to get along with you is through cooperation. The "trick" is to start working together.

As the owner of the law firm, it is up to you to communicate these simple company rules of conduct clearly and unambiguously to your employees. Just the fact that you are talking about the rules will ensure that you instill trust. Always start your relationships with your employees with friendliness and the offer of cooperation.

Invest the leap of faith. But also make it very clear that any abuse of trust will have immediate consequences and that you are unwilling to tolerate such behavior. Your employees must be able to clearly see which rules apply in your company.

But then be prepared to cooperate again. Give your coworker another leap of faith with the intention of not taking advantage of him this time. An employee who does not want to or cannot follow these simple rules may not necessarily be suitable as a regular for your team.

Most employees will appreciate this approach, however. An essential criterion for employee satisfaction is the fact that your manager's actions are predictable.

TIT FOR TAT - applied consistently - is a solid basis for a long-term development of trust in staff management.