The world of game theory has been on fire since Freeman Dyson of Princeton and William Press of the University of Texas announced that they had discovered a previously unknown strategy for the game of prisoner's dilemma - and it guarantees one player a better outcome than the other.
The Prisoner's Dilemma is this: Alice and Bob commit a crime and are arrested. The police offer each a deal to rat the other our and go free while their friend does 6 months in jail. If both Alice and Bob snitch, they both get 3 months in jail. If they both remain silent, they both get one month in jail for a lesser offence. What should Alice and Bob do?
Theorists have studied it for decades, using it as a model for the emergence of cooperation in nature and it has had a profound (and often unfortunate) impact on fields like economics, but also evolutionary biology and, of course, game theory itself.
If they cooperate, they both spend only one month in jail. Nevertheless, in a single game, the best strategy is to snitch because it guarantees that you don't get the maximum jail term.
It really gets interesting in multiple games and the best assumed strategy has been to mimic what your opponent did in the previous round. A new zero determinant strategy changes all that.
The Emerging Revolution in Game Theory by KentuckyFC, MIT Technology Review
arXiv preprint: Christoph Adami, Arend Hintze, 'Winning isn't everything: Evolutionary stability of Zero Determinant strategies', arXiv:1208.2666v1
