Game theory in law

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Each of us asked a question more than once: and what would happen if I arrived in a different way? As if everything developed if I didn't make something or, on the contrary, made? Always there are these "if"...

We appear every day before a choice, solving how to arrive and what to tell in this or that situation. Sometimes we make this choice at the subconscious level, without weighing all pros and cons. However sometimes it is necessary to make decisions on which depends if not all our life, its considerable part, or the attracting irreversible consequences.

Happens and so that the choice is made for us. The well-known aphorism of the American autoindustrialist Henry Ford can be a characteristic example of it: "You can receive "Ford T" of any color provided that this color will be black".

The practicing lawyers, especially judicial, in the career everywhere face a problem of a choice of this or that strategy of conducting business, adoption of this or that decision. It is very interesting to look at maintaining projects through a prism of Game theory.

Game theory is a mathematical method of studying of optimum strategy in games. It would seem how the section of applied mathematics can be applied to law? And, in general, about what games can there be a speech, when on a game - billions, the land plots, holdings and destinies of people? However, as shows my personal experiment, application of Game theory in legal practice gives enormous effect and as a result promotes achievement of positive result.

Game theory isn't consolidated only to decision-making or a strategy choice. It helps to define the best strategy taking into account ideas of other participants, their resources and possible acts. This circumstance is characteristic difference of Game theory from the theory of decision-making.

Game theory studies abstract model of a conflict situation, i.e. a situation in which, at least, two parties represented by individuals or collectives with partially or completely opposite interests participate. So, before working, it is necessary to count a probable choice of the opponent, uncertainty of a choice of the decision which only one party since it depends on many factors and, generally unpredictable actions of the opposite side can't influence turns out.

The characterizing game signs as mathematical model of a situation quite keep within understanding of Game theory in the legal framework. So, treats them:

• presence of several participants;

• the uncertainty of their behavior connected with existence at each of the parties of several options of actions;

• distinction (discrepancy) of interests of participants;

• coherence of behavior of participants as the result received by each of them depends on behavior of all parties;

• the established rules of conduct known to all participants.

Games represent the competitions which are characterized first of all by unpredictability of an outcome. As a rule, the first the conflict is entered in this case by that party which for the objective reasons is from the very beginning doomed to defeat. In consciousness the party of the conflict has a certain model as concerning her own behavior, and actions of the opponent. Further under the influence of acts of the opposite side in this model there are changes, the corrected line of conduct in the developed new situation is built.

The resolution of conflict belonging to the class of "games" in which it is necessary to expect not only own acts, but also actions of the opponent is called as "reflexive game". The main idea of the last is a reasoning of the party of the conflict on possible acts another.

It is easy to notice that the principle of "games" is similar to legal dispute that it is easy to illustrate with concrete situations from legal practice.

We will consider, for example, a question of the conclusion of the large contract. Often businessmen in a pursuit of profit make the transactions subsequently leading to deplorable results for the reason that other participant of "game" wasn't carefully studied. So, before signing the contract, it is necessary to check the contractor including for existence of lawsuits with its participation. If there is a lot of such affairs, it is necessary to prick up the ears and think, at least, the relevant contract is how important for you and what consequences of non-execution by the partner of the obligations (financial losses, losses, judicial proceedings, impossibility of real collecting the due money) will be. Thus it is necessary to count possible steps of the contractor in advance and as much as possible to secure itself against negative consequences of non-execution of the obligations by him, for example, having provided somehow performance of the contract.

The conclusion of the contract of cession can be one more bright example. We will assume that the party on good conditions for it (with big discount) decided to get the right of the requirement to the company which is at a bankruptcy stage. Thus three - the assignor, the assignee and the debtor participate in this "game". The assignee checks the debtor and, having convinced available at the last property, draws a conclusion about possibility of receiving money by realization of its property in competitive production. The contract of cession is signed. However thus the assignee makes a mistake: he doesn't analyze possible options of behavior of the assignor who as well as the debtor, is in a bankruptcy stage. As a result the court nullifies the contract of cession, the parties come back to the initial situation, the right of the requirement to the debtor passes back to the assignor, and money which the party paid for a right concession, it isn't possible to return as even on condition of collection of debt from the debtor money will go for repayment of requirements of creditors of the first and second stage.

Game theory is applicable and at the household legal conflicts. We will imagine that the husband and the wife intending to divorce and each of them participate in family dispute wants to retain the only child. The husband, preparing for judicial review of business, analyzes probable arguments of the wife: the father, say, doesn't care of the child, spends time outdoors, and he can't trust education. In response to these estimated arguments the husband looks for the witnesses capable to show the return in court. But also the wife doesn't lag behind. Knowing psychology of the spouse and expecting these or him similar actions, she "carries out work" with the child and wins round it at the answer to a question of court about with whom he wants to live - with mother or the father, the child chose it.

This quite simple scheme can significantly become complicated, up to forecasting and modeling of questions of judges, answers of witnesses, a scene of reconciliation, quarrel, etc.

Actually Game theory covers some fundamental truth of decision-making. If the company decides to invest, it has to consider reaction of the environment - whether it be competitors, clients or suppliers. The companies have to be able to count possible reciprocal actions of opponents.

A variety of such situations in real activity of the lawyer does Game theory necessary when training the highly qualified specialist.

Having faced a complex multilevel legal challenge, look at it through a prism of Game theory, study the rival, count beforehand all the subsequent steps, try to foresee the rival's acts, stock up with alternative options of behavior depending on its actions - all this will allow you to increase the chances of a victory as much as possible.

21 July 2014
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