Is game theory as insightful as it's made out to be?

okay forgive my youtube brain but i thought you were talking about the video game analyist channel and i was very confused

I am not that well-versed in it, but to me it always seemed a bit oversimplified; reducing living things, humans, animals etc, to purely rational actors that play a highly derived "game". We have scientific socialism, political economy, cultural materialism, historic analysis and dialectical materialism. I don't see where game theory has anything to add.

I only have a tangential comment that Marxist economist and ex-Greek finance minister Yanis Varoufakis wrote a book on game theory, which is sitting on my pile of books to read.

It’s a useful way of viewing risk/reward and it’s not incompatible with communist theory.

For example, if you take the prisoner’s dilemma and change the risk/reward structure, you can change the equilibrium such that it’s far more likely to have people cooperate.

Unfortunately, that’s not really something that people talk about all that often, because it’s only used to optimize winnings for one party, not to optimize for maximum societal benefit.

It’s a useful abstraction for understanding incentives which can be usefully descriptive of many situations.

For example, when applied to large groups of people then the fact it’s highly abstracted becomes a benefit since when we’re talking about many decisions by many people in aggregate then it makes sense to use simpler models that discard more individual motivations that don’t generalize.

It’s also very useful for predicting the behavior of systems that don’t have motivations beyond cost and benefit or that mercilessly seek to maximize benefit, such as assessing great power geopolitics or the behavior of corporations.

It’s wrong to think of game theory as a model of individual behavior (outside of actual games) but for aggregate behavior of many people towards incentives / risks or behavior of actors within constructed systems of risk-reward (geopolitics, business) it’s an often useful abstraction.

its good math absolutely horrible psychology(because its not meant to be). If u want insight into the logic and math it is meant to describe then yeah its great and its cool if u want insight into the motives and future actions of people which is what it is generally sold as in pop science settings and grifts its not insightful at all. It is a field of mathematics u wouldn't study calculus to understand people better game theory is no different, the idea that it would help is ridiculous.

Like with every useful scientific concept, it's nice until some big brain bro decides to make their entire worldview revolve around it

Doubt it, seeing "game theory" mentioned is a big red warning sign that terminal amounts of liberalism follows.

It's interesting maths, and on a personal note helped me be more aware of the incentives of the artificial systems that surrounds us.

But no, you shouldn't look at the prisoner's dilemma and think that eveyone would act like that in the same situation. Real people, specially when talking about individuals, rarely are completely "rational" (whatever that means) and many factors that matter a lot to individuals are completely discarded.

I have never read about it but my guess would be that it is an attempt to undermine marxism, as many other bourgeois philosophers have tried.

here is a good article that covers some examples of how the capitalist ruling class props up many unremarkable theories in attempts to undermine marxism: https://monthlyreview.org/2023/12/01/imperialist-propaganda-and-the-ideology-of-the-western-left-intelligentsia/

The flaw of game theory is the same as that of contemporary macroeconomics. It is useful in that it provides a mathematical interpretation of the things you are talking about, but its application to real-world phenomena suffers from its dependence on utility functions that have too many degrees of freedom to realistically nail down through observations. No matter the amount of data that goes into the construction of your utility function, the same data could be explained equally well by infinitely many other such functions. Beyond the prediction of simple games - hence the name - game theory becomes too underdetermined to provide models whose predictions could be scientifically validated.

I don't know extensively about it, but I have engaged with crossover science/biology/economic topics that deal with modelling "rational agents" to derive predictions. I find it overly reductive and hyper-individualist. It uses weird justification from "human nature" and static ideas of "conformity", "cooperation" and "non-cooperation" that only concern form and quantitative measures, depriving it of symbolic and meaning content. Its games and experiments are hyper static, isolated scenarios where real world implications and (material) relations are cast aside as "irrational" or unimportant factors, whereas for real humans these factors are central to their decisions and worldview.

Game theory relies on both parties understanding the "game" fully and making logical choices based on self-interest.

The world is unable to be understand fully and people often make illogical choices. It can be useful but only to a point.

It's useful if you're intent on solving your problems using capitalism

I don't know who is telling you that Game Theory is incredibly useful for understanding reality or providing context for history. It's, at its best, useful and practical analysis of themes and ideas. At its worst, it's 'ash was in a coma the whole time!' stuff. It's almost entirely for fun, and almost entirely for children. No harm done, but nothing really gained.