People like being stuck in traffic the way they like hearing nails against a chalk board; with the exception of a few masochistic individuals, it is universally loathed. If only the <Feds, State, County, City> would add another road no one would have to sit in this parking lot. Now of course one could imagine a number of logistical reasons to refute this fallacious line of reasoning: bottlenecking, merging delays, turning delays, signal delays, start-up delays and even further demand induced by the new connection, to name a few. While those are all certainly valid criticisms, what I intend to discuss here has nothing to do with with these more intuitive problems; there is a more fundamental problem rooted simply in mathematics and basic economic theory.
Conventional economic philosophy dictates that individuals rationally acting in their own self-interest would ultimately also benefit society as a whole– a sentiment well-captured by this panel from yesterday’s SMBC comic.
That is, it was conventional until famed economist, mathematician, paranoid schizophrenic, Nobel laureate, and protagonist of the book and film, A Beautiful Mind, John Forbes Nash, forever changed the field with his concept of equilibrium in non-cooperative games. His concept became known as Nash equilibrium and went on to become a cornerstone of contemporary game theory. Continue reading