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Economics

Game Theory Applications in International Trade Negotiations

Quick fact

The United States and China's trade war in 2018-2020 illustrates the classic 'tariff game' from game theory: both nations imposed tariffs, leading to higher prices and economic losses for both, replicating the Prisoner's Dilemma outcome.

Why this is interesting

Countries often strike tariffs against each other, but why do they end up hurting themselves? It's a game of strategy where the best move for everyone might be to cooperate, yet they often choose conflict.

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Game Theory Applications in International Trade Negotiations

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