All models break down at some level because they are merely simplified versions of life and cannot possibly control for all variables. Game theory, too, often fails to forecast with precision, yet this is not its purpose.
Game theory is simply a method of modeling how players interact.
It is an effective method for analyzing all available data so that the modeler can better understand how decisions are reached interdependently, given the assumptions of the model. I use game theoretic equations in business and in life, not with the expectation that all outcomes will be optimal, but rather that ''bad'' decisions will be minimized. It is a useful tool that can model simplistic scenarios, as well as the highly complex. The McGraw-Hill Companies Inc. All rights reserved.