Game Theory and Business Ethics

As the author of one book on the elements of game theory and another on the possible applications to ethics (Binmore [3,4,5]), I suppose it is natural that I should be asked to reply to Robert Solomon’s (13) claim that “game theory has been a disaster in ethics, and now it threatens to become devastating to business ethics as well.” However, I find myself somewhat at a loss as to know what to say, since the game theory he attacks is not practiced by any game theorists with whom I am familiar. At first, I thought this was because my friends and I were deemed to fall into the class of “refined” game theorists to whom Solomon is willing to grant grudging acceptance, but it turns out that their refinement lies in appealing to principles that contradict the essence of the game theoretic enterprise. My guess is therefore that the plain old “vulgar” game theory which he attacks is actually intended to be the same game theory for which John Harsanyi, John Nash, and Reinhard Selten were recently awarded the Nobel Prize. My strategy in replying will therefore have to be the same as those innocent men who are asked why they beat their wives. Instead of explaining why wife beating is a good idea, I shall have to insist that I don’t beat my wife at all.