Ducks know game theory?
Game theory sounds like something only intellectuals would use. After all, technical math is required for academic courses. And many introductory problems border on the bizarre, like learning how to solve a game of "hot or not." Game theory is famously associated with the RAND institute, a think tank of ...

Money tip number 189: stop trying so hard
Let me backtrack a moment for perspective. Most of us fail at money decisions because we don't try, or we don't try hard enough. That's probably why 99 percent of conventional money advice is about getting us to take action, and understandably so. I'd guess there are 188 tips more pressing ...

The Crummey trust and game theory: understanding the grim trigger strategy
My friend never broke curfew during high school. The consequences were too dire. His parents had threatened to cut off his allowance and scale back on helping him pay for college. Years later I would recognize the parents' strategy as an important game theory concept. They were playing what is known ...

Which investment news is worthwhile?
These days it is not much fun to read about the markets. So I think it's important to keep a good sense of humor. On that note, today I share a light story from one of my previous email newsletters (you can sign up here). Friend: I can't believe it. ...

The Game Theory of Stacking Matchups in Your Favor
Baseball pitchers and competition San Diego pitcher Jake Peavy did not like being called soft. On August 13, 2008, one day before a scheduled start, Peavy was brooding about accusations that he was choosing to face weaker opponents. Radio hosts were critical that Peavy had missed facing elite pitchers like ...

News flash: We workers want to feel useful, not just appreciated
My friend received a promotion, a raise, and a big fat bonus, but in the end, he still chose to leave the company. His departure offended some older executives who asked questions like "Doesn't this kid realize how good he has it?" The truth is that my friend did appreciate ...

If you find a small amount of money, what do you do?
Recently I found 50 cents at my supermarket. It's not a lot of money, but it got me thinking about found money in general. What's the proper thing to do? I've talked to many people and it seems the exact circumstances are important. Here are some of my favorite reactions. I'd ...

Business Drinking and the Dollar Auction Game
Business drinking provides a fun subject for strategic thinking. My friend told me about a telling experience on a business trip. He had visited a bar after a long day only to find members from a competitor company show up as well. The competition greeted him politely and offered to ...

How Do You Deal with Money Jealousy?
My friend liked his $3,000 bonus until he learned someone else got $7,000. His resentment illustrates a common issue: adversity is often not a question of "why me?" but rather of "why not me?" Jealousy is the culprit and we could all enjoy life more by ignoring it. Jealousy is a ...

Using Game Theory to Explain Why People Are Superficial
I'm on vacation this week, so I am mixing things up with a fun video I saw recently. The video title is "Using Game Theory to Explain Why People Are Superficial." The setting is a college lecture given by Dirk Mateer, Ph.D. Mateer sets up an incredibly entertaining lesson where students are ...