Tit for Tat. Take that!

On the internet I found this video:

http://www.huffingtonpost.com/2009/10/06/cab-vs-pedicab-road-rage_n_311303.html

It lies at the centre of the circled wagons of pop culture. It was linked to from bikesnobnyc. It was filmed outside of Dave Letterman’s studio. And of course the Fox video cameras were there because of the recent Letterman sex-blackmail scandal.

It documents a road rage incident, wherein two boofheads in baseball caps bash and berate each other to an accompanying cacophony of censorious bleeps.

I want to look at the economics of what happens. One of the big streams of economics is called game theory, which is the study of what happens in strategic situations. It is like psychology or sociology, but economics lays claim to it.

Watch the video. There are two protagonists, a cyclocab rider, and a cab driver. When the video starts, the cyclist is leaning over his shoulder and yelling at the taxi.

Key incidents are:
a toot at 0:02 seconds;
a thrown beverage at 0:08 seconds;
a deliberate sideswipe at 0:11 seconds;
a window punch at 0:14 seconds;
an aggressive exit from the cab at 0:15 seconds;
an ineffective right hook at 0:16 seconds; and
an impressive leg grab at 0:19 seconds.
Stalemate then ensues from 0:20 to 0:48.

What makes this fight happen, I reckon, is escalation.

The yelling needn’t have led to the toot. The toot didn’t warrant the mocha-latte being tossed in the cab window. The beverage splatter was insufficient to justify the ram attack. If the cyclo guy had taken it out on the window less forcefully, the driver might not have exited the cab. If the driver hadn’t run at the cyclist, then the latter might not have thrown the wimpy, misdirected hook and been upended in the traffic.

Game theory suggests that escalation leads to a complete break-down of cooperation. It turns out the most effective punishment strategy is a game of tit-for-tat. Tit-for-tat gets plenty of attention from conflict scholars as a potential way to de-escalate the Israel Palestine conflcit.

Assuming they want the other guy to stand down, the New York boofheads should retaliate equivalently, not by escalating. Where punishment is equal to the crime a mutually beneficial outcome can be obtained.

In this video, the boofheads fail to make punishments equal to the crime. Why?

Perhaps they never did economics. Alternatively, perhaps they think that if they escalate sufficiently they can prove to the other one that they are a complete psycho that shouldn’t be meddled with.

In the end, the cyclist guy manages to send this signal, in an unexpected and hilarious fashion. That marks the beginning of a detente and eventually the end of proceedings. I refer you to 2:34, certainly the high point of the video.

Happy weekend!