Let's talk about the shelling Point shelling point is a game theory concept made famous by Thomas schelling
in the book called strategy of conflict, which I do recommend reading
and it's about multiplayer games where other people
are responding based on what they think your response is what he came up with was the mathematical formalization of how do you get people who cannot communicate with each other to
coordinate suppose that I want to meet with you, but I don't tell you where and I don't tell you when we
both want to meet but we cannot communicate any more information to each other that would sound like an impossible problem to solve we're done. We can't do
it not quite because I know that
you're rational person and smart and educated and you know, I'm a rational person who's
smart. We're going to start thinking well if we have to pick an arbitrary date, we're probably going to pick New Year's and what time midnight or 12:01 a.m. And where would we meet what is a big meeting point? Well if we're Americans is probably in New York City. It's the most
important city
and we're in New York.
He will we meet at midnight. Probably Grand Central Station Under the Clock.
Maybe you end up at the Empire State Building, but not likely
so you can just use social norms to converge in this case onto a
selling point and there are many times in many games where you can look
at the game itself, whether it's business or art or politics and you can find the convergence shelling Point within the context of that game. And so you can cooperate with the other person. Here's a simple example, let's suppose that you have two companies that are competing heavily with each other and they hold an oligopoly and let's say that they're competing right now in the price fluctuates between eight bucks and 12 bucks or whatever the services don't be surprised if they both could version 10 bucks without ever talking to each other.
