Friday, October 14, 2005
I'm a little more optimistic of game theory than many of those in Bill's post. Remember, the story of free-market economics is that institutions form that allow us to expand the circle of potential transactors. People find ways to "do business" with others in a way that is cooperative. Cooperative games are a neat way to illustrate how the circle expands. Will it generate "testable hypotheses"? I don't know, but it can give us some powerful metaphors.