Strategic Thinking: Strategic Competition in Business, Politics, and Daily Life

Author: Avinash K. Dixit
Publisher:
Publish Date: 2003-02-01
Features: Life is an endless process of decision-making. What kind of job to take, how to manage a business, whom to marry, how to raise children, whether to compete for the CEO position—all are examples of such decisions. You are not making decisions in a vacuum. Instead, you are surrounded by other decision-makers just like you. Although there is a lot of conflict, there are also many elements of cooperation. This book will help you learn to think strategically and increase your chances of winning in life's games. The book succeeds through storytelling. Its academic roots lie in the "Strategic Games" course taught by Professor Dixit at the Woodrow Wilson School of Public and International Affairs at Princeton University. In short, it is the art of understanding how your opponents intend to defeat you and then defeating them. How to win a tennis match, how a minority can defeat a majority, why you should "love" your hated opponent, and more are all discussed. This is a new strategic science composed of some simple basic principles. Readers from different backgrounds and industries who master these principles will see their ability to strategize and win rise to a new level. This work by Yale Professor Nash and Princeton Professor Dixit uses many vivid examples to show readers without an economics background the principles of strategic thinking in game theory. Take an example: When Nash graduated from college, he participated in a roulette game at a formal dance at Cambridge University and was leading with a ratio of 700:300. With the grand prize within reach, he inexplicably ignored his advantage of moving second and went first in the final round, only to fail. Later, he recalled that he had drunk too much and forgot the lesson of game theory: when leading, it is better to adopt a conservative strategy of allowing the opponent to move first. This top student of game theory lost to a woman who was originally in second place and had even suggested sharing the reward (see Chapter 1 of this book).