Drawing Insights from Game Theory to Make Career Decisions

Today’s career paths are widely diverse, but there’s one thing they all have in common: the scarcity of resources. Resources are scarce; they have always been. Be it the amount of time you can devote to a particular career goal, the money you can invest on it, or the energy you can afford to spend in pursuing a career goal – they are all limited. That’s where economics steps in – the science of managing scarce resources. There is one particular branch of economics that deals specifically with decision making in adversarial situations, and it tells us a lot about the way we should be making decisions in life – game theory.

A little background

The game theory deals with the study of ways in which the choices of parties involved in a particular situation/transaction/circumstance affect each other, often in ways that were not intended by either of the parties. The ‘game’ here has a quite broad meaning – anything that involves interaction between two or more parties.

Games can be either finite or infinite. Finite games are the ones that have predetermined or expected rules and courses of conduct that are known to all the parties involved. They end at a certain point, with either party winning and the other party losing. Examples include football matches, competitive sports, conventional warfare, etc.

Infinite games are strange – they don’t have any rules or conventions attached to it, and none of the parties has a clear idea about the outcome. No one party loses in an infinite game; the game goes on and on until one party decides to withdraw due to lack of interest or depletion of resources. Examples include business, international diplomacy, politics, career trajectories of professionals and most important, life!

What does game theory mean for career choices?

Career trajectories are infinite games. They aren’t won or lost; they are played on and on until the player gives up. The only ending point is when the player quits, and no other.

However, just because there are no losers and winners in an infinite game it doesn’t mean all the choices made in such a game are equally good. In fact, quite the opposite – every single choice that we make in an infinite game decides our future course of action and its impact on the grander scheme of life as a whole.

While making choices in a game, be it a finite one or an infinite one, decisions are taken based on one of these two in mind: our immediate interests, and our values. Decisions aimed at securing immediate interests are often useful in finite games. They secure us the win, because they have a finite time limit and a predictable frame.

However, things are a bit different for infinite games. Over an extended period, decisions aimed at immediate interests have a discrete randomness in them, since our interest keeps changing over time and place. Today our interest may lie in earning money; tomorrow it may lie in securing an appointment with someone; the next day it may be in getting a project completed in time. When we make decisions based on our immediate interests, it becomes haphazardly random, with no necessary connection between them. This randomness makes it difficult for us to build allies and networks, since it doesn’t send out any clear message about what we stand for.

A better way to make decisions in an infinite game is by considering our values. When we make decisions based on our values and long-term visions, it provides us with coherence and integrity. It sends out a message to potential allies and networks about what we stand for, and what we would fight for. A few short-term interests may be defeated when we make choices this way, but worry not, since there are no winners or losers in this game, only players who play long enough!

Another benefit of value-based decision making in an infinite game is it provides you with longevity. Say, for example, companies doing business. Business is a well-known example of an infinite game. Companies who forget this and base their choices on satisfying short-term goals like quarterly profit or yearly turnover are always outlasted by companies who have long-term goals and visions that’s something more than annual turnovers. Companies who ignore the fact that business is an infinite game are often sold out/bankrupted/acquired/merged in a short period. The same happens with all other infinite games, including our career trajectories.

The point to take home

Long conclusions do little good, so here’s a short point to take home: in an infinite game, it’s not about winning or losing, it’s about who plays long enough to see the other players quitting.


This post first appeared here.


ABOUT THE AUTHOR

ANSHUMAN SAHOO

Seminar address

Anshuman Sahoo is an advocate at Odisha High Court and can be found at www.anshumansahoo.com.

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