Cooperation & Competition
Channel: Systems Innovation
Date: 22/05/2015

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In this module, we are going to talk about the dynamics of cooperation and competition between agents within complex systems. We will first discuss the general concept before looking at zero and positive-sum-games, following this, we will be talking about negative externalities as we look at the so-called “tragedy of the commons “ and social dilemma.

A core premise of complexity theory is that global patterns in complex systems emerge out of the synchronization between the states of elements on the local level, whereas
the terms synchronization or desynchronization are generic to any type of system when we are dealing with elements that have agency, that is to say some form of choice over their actions, we will refer to this as cooperation and competition, as agents now have some choice as to whether they synchronize their state with other agents locally, what we will call cooperation, or inversely, they may choose to adopt an asynchronous state with respect to other agents, what we will call competition. Cooperation and competition between agents don’t occur randomly, it is the product of both local and global forces as the incentives for an agent to choose one of either are often built into the context of the situation they are engaged in. In order to illustrate this we will look at what is called a zero-sum game.
In game theory and economic theory, a zero-sum game is a mathematical
representation of a situation in which each participant's gain or loss is exactly balanced by the losses or gains of the other participants. If the total gains of the participants are added up and the total losses are subtracted, they will sum to zero. Thus cutting a cake, where taking a larger piece reduces the amount of cake available for others, is an example of this. A zero-sum game is also called a strictly competitive game, as the pie cannot be enlarged by good negotiation and cooperation there is no incentive for cooperation between agents in these situations, but in fact a strong attractor state toward competition. War is another example of a zero sum situation, in these games what the other looses you gain thus keeping track and comparing your state to that of you opponent makes sense. Zero-sum games are linear and additive the whole system is simply a summation of its constituent elements, thus they are essentially simple or non- complex.

Complexity arises when we have a dynamic between competition and cooperation. Situations where participants are interdependent, being able to all gain or suffer together, are referred to as non-zero-sum. For example, all trade is by definition positive sum, because when two parties agree to an exchange each party must consider the goods it is receiving to be more valuable than the goods it is delivering, this type of positive sum game is a strong driver towards cooperation. As the pie gets bigger and everyone gets higher payoffs by simply interacting. There are many scenarios like this where the cost of coordination is relatively low and the payoff is relatively high, everyone driving on the correct side of the road is an example of this, there is little incentive not to do so and very high incentives to coordinate thus making cooperation a very strong attractor state. But of course not all scenarios are like this, non-zero-sum games often involve an interplay between competition and cooperation. As an example of this, we might think about a game of doubles tennis where you have a zero-sum game of competition with your opposition but a positive sum game with your team member. Problems in the real world are typically non-zero-sum, where there is no single optimal strategy that is preferable to all others, nor is there a predictable outcome. Players engaged in a non-zero sum conflict have both some complementary interests and some interests that are opposed.
There are a number of variables that can be altered to adjust whether a game will on balance favor cooperation or competition between agents. On going interactions


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