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A Game Theory Interpretation of the Post-Communist Evolution

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  • Dimiter Ialnazov
  • Nikolay Nenovsky

Abstract

Our hypothesis is that both the transition phases and the diversity of trajectories of post-communist countries are the result of a significant difference in actors' strategic behavior. If we apply game theory to the socioeconomic context of post-communist evolution, this difference reflects the two main models of cooperation, namely the prisoner's dilemma and the stag hunter. The prisoner's dilemma, which becomes the dominant strategy under the conditions of high social heterogeneity and broken informational channels, implies that it is profitable not to cooperate. Under the stag hunter model — a model involving a common goal and a common project — cooperative strategies are more advantageous. The various post-communist countries in different transition phases can be approximated to either one of those two games — the prisoner's dilemma or the stag hunter. The alternation of the games is conditional on the existence of external and internal social anchors.

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  • Dimiter Ialnazov & Nikolay Nenovsky, 2011. "A Game Theory Interpretation of the Post-Communist Evolution," Journal of Economic Issues, Taylor & Francis Journals, vol. 45(1), pages 41-56.
    • Handle: RePEc:mes:jeciss:v:45:y:2011:i:1:p:41-56
    DOI: 10.2753/JEI0021-3624450103
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