Equilibria

It’s a well-known fact that a cake can be divided into two equal slices in cooperation by two players, who each only want to maximise their own share of it. All we need to do is tell one of them to cut the cake in two and the other to pick a slice.

Without even attempting any calculations it’s easy to see how their greed balances out and guarantees a fair outcome, exactly as game theory predicts.

Except…

Here, in front of us are two people desperate for cake.

And we’ve just given one of them a knife.

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