76 THE INVESTMENT TEAM
If you both snitch on each other, you will both get three years in
prison.
If neither of you snitches, the police will have no evidence
and you will both go free.
If one of you snitches but the other doesn’t, the snitcher will
make a deal with the police and will go free while the other one
goes to jail for six years.At first glance the correct strategy appears obvious. No matter what
the other suspect does, you’ll be better off informing (“snitching”).
Maddeningly, the other suspect realizes this as well, so you both
end up getting three years. Ironically, if you had both “cooperated”
(refused to snitch), you would both be much better off.
The goal is to figure out the other suspect’s strategy and use it
to reduce your total jail time. The other suspect will be doing the
same.
The movie L.A. Confidential contains a classic scene of the
Prisoner’s Dilemma. About 55 minutes into the film, Lt. Ecksley
conducts an interrogation of three suspects in the Night Owl
Massacre. He places them in three different rooms, with one-way
mirrors and sound equipment so that the other suspects can hear
the person that Ecksley is questioning. At one point, Ecksley ex-
actly poses the Prisoner’s Dilemma, when he says to the second
suspect, “Ray Collins just ratted you off. He said that the Night
Owl was your idea. I think it was Ray’s idea. If you talk I think I
can save your life. Son, six people are dead. Someone has to pay
for that. Now, it can be you or it can be Ray.” By playing both
sides against the middle, Ecksley gets the suspect to confess.
In our classroom exercise, we use blue and red chips to sym-
bolize “snitch” and “cooperate.” Each team confers and then places
a chip in an envelope and passes it to the facilitators. The scoring,
following the options described earlier, is shown in Figure 9.1.
The scores are posted and another round is played. After the
second round, teams are allowed to negotiate based on the chips
played so far. The winning team at the end has the highest posi-08-13 ware 76 1/19/01, 1:10 PM