Zerosum describes a situation in which a participant's gain (or loss) is exactly balanced by the losses (or gains) of the other participant(s). It is so named because when you add up the total gains of the participants and subtract the total losses then they will sum to zero. Cutting a cake is zero or constantsum because taking a larger piece for yourself reduces the amount of cake available for others. Situations where participants can all gain or suffer together, such as a country with an excess of bananas trading with an other country for their excess of apples where both benefit from the transaction, are referred to as nonzerosum. The concept was first developed in game theory and consequently zerosum situations are often called zerosum games though this does not imply that the concept, or game theory itself, applies only to what are commonly referred to as games. Optimal strategies for twoplayer zerosum games can often be found using minimax strategies. Game theory is a branch of applied mathematics that uses models to study interactions with formalised incentive structures (games). Unlike decision theory, which also studies formalised incentive structures, game theory encompasses decisions that are made in an environment where various players interact strategically. ...
Minimax (sometimes minmax) is a method in decision theory for minimizing the maximum possible loss. ...
In 1944 John von Neumann and Oskar Morgenstern proved that any zerosum game involving n players is in fact a generalised form of a zerosum game for two persons; and that any nonzerosum game for n players can be reduced to a zerosum game for n + 1 players, the (n + 1) th player representing the global profit or loss. John von Neumann in the 1940s. ...
This means that the zerosum game for two players forms the essential core of mathematical game theory. (The two paragraphs above are translated from the French article on zerosum games) To treat a nonzerosum situation as a zerosum situation, or to believe that all situations are zerosum situations, is called the zerosum fallacy. This article or section should include material from Lump of labour fallacy A zerosum fallacy is a logical error committed by assuming that some quantity is constant when it is not. ...
Economics and nonzerosum
Nonzerosum situations are an important part of economic activity due to production, marginal utility and valuesubjectivity. Most economic situations are nonzerosum, since valuable goods and services can be created, destroyed, or badly allocated, and any of these will create a net gain or loss. The optimal strategy for nonzerosum games is Tit for Tat. In economics, marginal utility is the additional utility (satisfaction or benefit) that a consumer derives from an additional unit of a commodity or service. ...
Tit for Tat is a highlyeffective strategy in game theory for the iterated prisoners dilemma. ...
If a farmer succeeds in raising a bumper crop, he will benefit by being able to sell more food and make more money. The consumers he serves benefit as well, because there is more food to go around, so the price per unit of food will be lower. Other farmers who have not had such a good crop might suffer somewhat due to these lower prices, but this cost to other farmers may very well be less than the benefits enjoyed by everyone else, such that overall the bumper crop has created a net benefit. The same argument applies to other types of productive activity. Trade is a nonzerosum activity because all parties to a voluntary transaction believe that they will be better off after the trade than before, otherwise they would not participate. It is possible that they are mistaken in this belief, but experience suggests that people are more often than not able to judge correctly when a transaction would leave them better off, and thus persist in trading throughout their lives. It is not always the case that every participant will benefit equally. However, a trade is still a nonzerosum situation whenever the result is a net gain, regardless of how evenly or unevenly that gain is distributed.
Complexity and nonzerosum It has been theorized by Robert Wright, and among others, that society becomes increasingly nonzerosum as it becomes more complex, specialized, and interdependent. As one supporter of this view states: Robert Wright, one of the clearest and most thoughtful writers of this or any era, is a visiting scholar at the University of Pennsylvania. ...
 The more complex societies get and the more complex the networks of interdependence within and beyond community and national borders get, the more people are forced in their own interests to find nonzerosum solutions. That is, winwin solutions instead of winlose solutions.... Because we find as our interdependence increases that, on the whole, we do better when other people do better as well  so we have to find ways that we can all win, we have to accommodate each other  Bill Clinton, Wired interview, December 2000.[1]
William Jefferson Clinton (born William Jefferson Blythe III on August 19, 1946) was the 42nd President of the United States from 1993 to 2001. ...
Wired can refer to: Wired magazine, a monthly technology magazine. ...
This article is about the year 2000. ...
See also  game
 groupdynamic game
 winwin game
