what is a zero-sum game?

In: Other

Let’s play a game of dice. We each bet $10 that the die will roll a certain way. Winner gets the whole pot, or put another way, the winner gets $10 and the loser gives up $10.

This game is zero sum because the winner’s gain ($10) plus the loser’s loss (-$10) adds up to zero.

In each iteration of a zero sum game, you win by the amount that I lose and visa versa. When taken to its conclusion, the winner has everything and the loser has nothing. It follows a pareto distribution such that the more you win by, the more probable it is that you will win the game.

It is a term from game theory.

It means that no matter who wins or loses, everone’s wins and losses always add up to the same thing.

In order for someone to win big someone else has to lose big.

In real life things often look like they might be zero-sum when you oversimplify them but real aren’t.

Non-zero-sum games have outcomes where it is possible to maximize the collective winnings by working together while in zero sum games the pot won’t grow any bigger no matter what you do and it is best to just try to win yourself.

Zero sum is from game theory, meaning that no extra value is added. all the value is static.

Meaning that if one person obtains more, it means someone is losing.

So an example of a zero sum game is a poker match between 2 people, with the game bets being the only winnings.

An example of a non zero sum game, would for example be the competition between two foodstalls. If one of them suddenly starts selling more cause it got rave reviews, it doesn’t automatically mean the other stall gets less. There might just be more people coming by. They might even get more from people unwilling to wait in line. In this “game”, a player can win without his competition losing

A game where all the value is in play at the beginning and none is added or created as you go.

If we’re playing poker, just the two of us, then every chip you lose i gain that exact chip and every chip i lose you gain. At the end of the round there are exactly as many chips on the table as there were before the round. If you add up all of my gains and losses, then combine that with all of your gains and losses it will all sum up to zero.

Now if we’re playing something different, like Monopoly, it may be a non-zero sum game. In Monopoly you can lose money to other players and if this were the only way money changed hands it would be zero sum; however, you can also lose money to the bank or earn money from the bank(crossing start) which means that at the end of the round you can finish with a lot more money in play than was dealt out at the beginning making monopoly a **Non-Zero Sum Game**