The U.S.-China trade war, according to game theory
30 May - 28 mins
Podcast Series
Planet Money
Over the last few months U.S.-China trade relations have been pretty hard to make sense of – unless you look at what's happening through the lens of game theory. Game theory is all about how decisions are made, based not just on one side's options and payoffs, but on the choices and incentives of others.
So, are Donald Trump and Xi Jinping competing in a simple game of chicken? Or is the game more like the prisoner's dilemma? On today's show, we try to decide which of four possibilities might be the best model for this incredibly high-stakes game. And we take a look at who is playing well and who might need to adjust their strategy.
For more on the U.S.-China trade war:
- The 145% tariff...
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