Comparison of (T, T) and (T, I) Allocations in the Pest Control Game
In the pest control game, the allocations (T, T) and (T, I) are Pareto-incomparable. The (T, T) outcome, where both players use Toxic Tide, results in payoffs of (2, 2). The (T, I) outcome, where Anil uses Toxic Tide and Bala uses IPC, yields payoffs of (4, 1). To move from (T, T) to (T, I) would make Anil better off (4 > 2) but Bala worse off (1 < 2). Because a move between these two allocations necessarily makes one player worse off, neither allocation Pareto-dominates the other.
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Ch.4 Strategic interactions and social dilemmas - The Economy 2.0 Microeconomics @ CORE Econ
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• Outcome W: (3, 3) • Outcome X: (2, 2) • Outcome Y: (1, 4) • Outcome Z: (4, 1)
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