Adam Tanielian

Mayville State University

Math 420

(Lonborg and Wesstein, 2016)

Nash equilibrium is one of the better known theories in

20th century mathematics. However, the technical
definition (above) is not how it is typically known.
Nash equilibrium, and moreover game theory, is best
known for economic and political applications. In
words, the Nash equilibrium is a situation in a strategy
game wherein no player can unilaterally achieve a
better outcome, so no player has an incentive to
deviate from the current strategy. It is, thus, an optimal
outcome for each player, given the strategy of the other
player(s).

John Forbes Nash, Jr.

Studied decision-making math in 1950s

Developed schizophrenia
Divorced by 1962, remarried 2001
Subject of A Beautiful Mind (Howard, 2002)
1994 Nobel Prize
2015 Abel Prize
Killed in car crash 2015 (BBC, 2015)

Although it never actually happened, this scene from the film depicts Nash
applying his theory in a practical situation (Chang, 2015).
Nash went from Fortunes brilliant young minds list to the list of residents of a
psychiatric hospital in less than two years. He thought aliens made him
emperor of Antarctica. I would not dare to say that there is a direct relation
between mathematics and madness, but there is no doubt that great
mathematicians suffer from maniacal characteristics, delirium, and symptoms
of schizophrenia, he said (Pickover, 2009, p400).

Of Cola Wars and Peace

Coke
Advertise

Coke
Dont Advertise

Pepsi
Advertise

(80,80)

(120,45)

Pepsi
Dont Advertise

(45,120)

(100,100)

One of the most famous examples of Nash equilibrium is Pepsi versus

Coke (Council for Economic Education, n.d.), although this examples
merely demonstrates an oligopoly market decision. In the given example,
each player is doing its best given the other players moves when they
both choose to advertise. This may seem odd, considering that if both
choose not to advertise, they make more than if they both choose to
advertise, but they each stand to lose more if the other player advertises.
This same type of game construct can be used to examine animal
behavior, decision-making processes for criminals and parties to wars. I
will discuss the Prisoners Dilemma in presentation F.

Image References
P1 http://www.polkacafe.com/theories-by-john-nash-1453.html
P3
https://www.pokertube.com/poker-news/poker-gossip-opinion/
549-nash-equilibrium-inventor-john-nash-killed-in-a-car-cr
ash
P4 https://youtu.be/CemLiSI5ox8
P6
http://www.barefooteconomist.com/nash-equilibrium-and-thereal-world/

References
BBC (2015). 'Beautiful Mind' mathematician John Nash killed in
crash. From
http://www.bbc.com/news/world-us-canada-32865248
Chang, K. (2015). Explaining a Cornerstone of Game Theory: John
Nashs Equilibrium. The New York Times. From
http://www.nytimes.com/2015/05/25/science/explaining-acornerstone-of-game-theory-john-nashs-equilibrium.html?_r=0
Council for Economic Education (n.d.). Advanced Placement
Economics Microeconomics: Teacher Resource Manual, Activity
3-17. From
http://marsd.org/cms/lib7/NJ01000603/Centricity/Domain/202/A
PE%20Micro%20Activity%203%2017%20answers.pdf
Howard, R. (director) (2002). A Beautiful Mind (film). Universal
Pictures and Dreamworks Pictures.
Lonborg, A., and Weisstein, E. (2016). Nash Equilibrium. From
http://mathworld.wolfram.com/NashEquilibrium.html
Pickover, C. (2009). The Math Book. New York, NY, USA: Sterling.