Definition
Per (Scotchmer), the Prisoner’s Dilemma shows how the equilibrium is stable (Nash equilibrium) and each individual’s decision is rational: confessing is the dominant strategy, yet creates an outcome that collectively is suboptimal relative to mutual cooperation (the Pareto optimal choice).
Scotchmer, Liam. “The Prisoner’s Dilemma EXplained: Rational yet Suboptimal Decision Making.” Polonomic Papers, 2025, polonomicpapers.com/prisoners-dilemma. Accessed 10 Feb. 2026.
