Games Indians Play

by V Raghunathan

  Naipaul puts it with some finesse when he says, ‘Hindu morality, centered on the self and self-realization, has its own social corruptions . . .’ Is this special corruption then the answer to that ‘Why’? I wish the genetic argument was the answer, for then we could wash our hands off any responsibility towards the way we are. If there is anything wrong with us, it is not our fault. We are simply like that only—genetically.

  In short, I do not know if we are ‘like that’ for reasons of our poverty, education, population, climate, colonial past or whatever. I do not think the traits I listed earlier are the exclusive preserve of the socio-economically challenged segment of the country. Those of us breaking queues at the airports do exactly what our brothers and sisters do at a ration shop or at the public tap. Population and climate? Well, most of the Far Eastern economies have climatic conditions and population densities little different from ours, and their cities and towns are nevertheless far more clean and orderly. Colonial past? There are any number of countries outside our subcontinent that had been colonized and have bounced back as working and orderly states after suffering a much worse past than us.

  WHAT THIS BOOK IS AND IS NOT ABOUT

  Surely many of our behavioural traits, as evidenced by my spew of questions earlier, may also have to do with weak enforcement and weaker consequences of enforcement in our country. There could be a million other persuasive reasons for our being what we are and we could expound on these, given our ability to blather and debate anything till the cows come home. But I shall not. Because this book is not about finding external excuses for our behaviour. After all, it is we who are responsible for the enforcement and regulation of our behaviour.

  If so, what is this book about? What aperture do I retain to show you a fog-free view of our Indianness you have not seen already? What are the attributes that we may say define our Indianness?

  The questions raised above are many and mundane and probably need some classification. I have therefore pigeonholed these questions into twelve ‘canons’ of Indianness and discuss them in the course of this book. These characteristics are:

  Low trustworthiness

  Being privately smart and publicly dumb

  Fatalist outlook

  Being too intelligent for our own good

  Abysmal sense of public hygiene

  Lack of self-regulation and sense of fairness

  Reluctance to penalize wrong conduct in others

  Mistaking talk for action

  Deep-rooted corruption and a flair for free riding

  Inability to follow or implement systems

  A sense of self-worth that is massaged only if we have the ‘authority’ to break rules

  Propensity to look for loop holes in laws

  I have not listed the characteristics in any structured order. I intend to throw some light on them in the backdrop of game theory and behavioural economics. Game theory is nothing but the economists’ term for what psychologists call the theory of social situations. And behavioral economics is the interaction between psychology and economics that tries to explain how human limitations and complexities affect choice. I do not see the need to devote a separate chapter for each of the traits listed above. I will just peck, bite and nibble at them here and there, helping to wash them down with the spirit of game theory and a dash of behavioural economics. The aim is to make the reader understand how and why our current behavioural traits need to change if we wish to be counted among the more civilized people of the world. In this sense this book is not quite diagnostic. Rather, it is akin to a CAT scan that could provide a better peek into one’s own self.

  Many may take umbrage at my inherent proposition that we are largely a less-civilized people than most other major nationalities and hence we need to take a fresh look at ourselves. A word of advice to such readers: To consider the time taken to read this book as well spent, there are three points that the readers must be ready to acknowledge as prerequisites: one, that there is indeed something wrong with us; two, that there are aspects in our traits that do not seem to sit well in a modern civilized society; and three, that merely because other modern and civilized societies, whether occidental or oriental, also suffer from many ills, it does not make our own ills any more acceptable.

  By calling our society less civilized, I do not imply that we have no strengths as a people. Of strengths we have many. We are intelligent and industrious (though perhaps in a more self-serving and less productive way than most other people), have strong family values (which are often the cause for nepotism), are friendly (even if to the point of being obsequious to the occidental skin, never having really hatched out of our colonial shell) and stick together in times of hardship, as could be seen during the sundry wars we were engaged in during the last few decades, and in the aftermath of the December 2004 tsunami.

  But then, these traits are not singular to us. The Israelis, the Chinese and the Japanese are no less industrious than we are, and they are probably a little less self-serving and far more productive as individuals. The Chinese, the Japanese and the Italians have family values no less robust than ours. And the United States also showed how the entire country could come together during the 9/11 tragedy. But our failings, it would seem, are almost singular to us, or to our subcontinent maybe.

  It is a fact that we are an ancient civilization and that up to the medieval times we were among the most advanced civilizations. The putrefaction of our civilization perhaps set in a good thousand years ago, from which time our contribution to the world went steadily downhill. But then, a glorious past can hardly be a consolation for a sorry present. That the Indus Valley civilization at Mohenjo-Daro and Harappa had glorious town planning over 2000 years ago is cold consolation for our wretched present-day cities, towns and villages. While other civilizations have gone on to build upon their past, we are merely living off it and, what is more, we have been doing it for over a thousand years! Now what riches in the world can withstand such an onslaught on its principal? Once again, Naipaul comes to mind: ‘How often in India—at every level—rational conversation about the country’s problems trails away into talk of magic, of the successful prophecies of astrologers, of the wisdom of auspicious hours, of telepathic communications, and actions taken in response to some inner voice!’3 Is that our Freudian way of escaping harsh realities?

  SOME DISCLAIMERS

  Let me place before you some explicit disclaimers, warnings and cautions:

  This is not a research-based book, even if it borrows from the researches of some, and a few of my own, not necessarily rigorous, experiments.

  This is not a book on game theory or behavioural economics, even if it uses the two disciplines as useful crutches to precipitate some degree of analytical awareness on some of the average Indian traits that I find bothersome.

  This is not a book on sociology, even if it attempts to address a social issue like the Indianness of us Indians.

  Most of the conclusions arrived at are at worst conjectural and at best plausible hypotheses for further research that students of behavioural economics or social psychology, particularly those in India, may wish to test.

  This book is not about every aspect of Indianness and it certainly does not touch upon the many achievements that we, as a country or a people, may have.

  This is just a potpourri of a book not aimed at any specific group of readers in particular. In fact, the reader should read on only if the questions raised in this chapter have troubled the reader at some point in time or the other.

  While this chapter raises questions, Chapter 2 briefly discusses the assumption of rationality in decision-making among human beings. Chapter 3 familiarizes the reader wit
h the problem of simple prisoner’s dilemma and takes a look at some of our traits in the backdrop of the dilemma. Chapter 4 deals with iterative prisoner’s dilemma, with examples drawn from our everyday observations as well as some constructed parallels. Chapter 5 underscores how it helps to cooperate even if one were selfish in the extreme sense of the word. Chapter 6 deals with issues of self-regulation and fairness, and looks into how self-regulating and fair we are as a people vis-à-vis those elsewhere. Chapter 7 takes a look at the free-riding phenomenon and our own propensity to free ride. Chapter 8 deals with how and why we are a country that can neither impose systemic solutions to any of our problems nor stick by these solutions. Chapter 9 answers the poser contained in the Prologue. And finally, for those who may be more spiritually inclined, Chapter 10 links game theory with some of the teachings of the Gita and explains the role of dharma in a game theoretic context. On to rationality in the next chapter.

  CHAPTER 2

  On Intelligence and Rationality

  Your city is reeling under a severe heat wave, and the water tables have disappeared to the depths. The local government has made impassioned pleas to its citizens to shower only every alternate day for a month, by which time the worst of the crisis will be over. You have had a hot night after a power cut and would love nothing more than a nice cold shower first thing in the morning. But today is your turn to skip bath. Your overhead tank is full and a shower will surely rejuvenate you. Forgoing it could benefit the city, but only marginally. Is it rational to sacrifice your shower? Is it rational to inconvenience yourself when it will barely make a difference to the city as a whole?

  PEOPLE ARE RATIONAL

  In the preface I mentioned that my interest in game theory and social dilemmas drew me towards behavioural economics. Let me explain game theory and behavioural economics a little more. The Oxford English Dictionary defines game theory as ‘the mathematical analysis of competitive strategies where choices depend on the action of others, e.g. in war, economics, games of skill, etc.’ According to Wikipedia, it is ‘a hybrid branch of applied mathematics and economics that studies strategic situations where players choose different actions in an attempt to maximize their returns’. Game theory was first developed as a tool for understanding economic behaviour and then by the Rand Corporation to define nuclear strategies. Since then, it has travelled just about everywhere: in academic fields as diverse as biology, psychology, sociology and philosophy. It has been applied to animal behaviour and to political science. That is why game theory is also accepted as the theory of social situations. In fact, Thomas C. Schelling and Robert J. Aumann won the Noble prize in economics in 2005 for their work in game theory applied to arms race, price wars and actual warfare. Thus game theory is not something arcane and academic but a very practical tool for understanding day-to-day social situations. And for me, our Indianness— exemplified by, say, why we routinely jump queues—provides a rich and fertile ground for applying this theory if only to help us introspect on whether we genuinely approve many of our own actions in the social context.

  Behavioural economics (and behavioural finance, both are closely related) applies research on human and social perceptions, frailties and biases for insight into economic decisions—the role of reason in the economic choices we make. As you can judge, psychology too comes into play. Here is an example. Let us say that both you and I have a flight to catch at 8 p.m., though our destinations cities are different. Let us say we decide to share a cab and perchance get caught in a traffic jam of the kind that happens once a decade. We are stuck for several hours and as we cannot turn back we end up reaching the airport anyway, albeit four hours late. Pure economics will tell us that if our losses or other consequences such as having to stay an extra night, pay for the cancellation of the tickets, etc. are all identical, our regret at missing the flights will also be more or less identical. But now, suppose the airline staff tells me, ‘Sorry sir, your flight left on time,’ while you are told, ‘Oh how very unfortunate sir, your flight was three hours and fifty-five minutes late and they just closed the aircraft’s doors!’, who feels more sorry about missing the flight? Here lurks psychology mixed with economics for you, which often explains everyday situations much better than pure economics alone can.

  A number of game theorists have contributed to the body knowledge of modern game theory. John von Neumann and Oskar Morgenstern were among the early theorists who dealt essentially with non-cooperative games with ‘pure rivalries’, that is, zero-sum situations, where one can win only at the cost of another. However, it was Nobel laureate John Nash who first turned his attention to rivalries with mutual gain, that is, non-zero-sum situations, where one does not have to win at the cost of another, as both parties can emerge winners. Following his works, albeit through the Scientific American articles of Hofstadter, has helped me understand our characteristics like rationality, irrationality, egotism, selfishness, antagonism, competition, collaboration and cooperation as Indians vis-à-vis peoples elsewhere in the world. All versions of game theory essentially assume extreme rationality of human beings—rationality consistent with extreme selfishness. However, the theories also prove both theoretically and empirically that such selfishness need not come in the way of cooperation, and hence in the overall betterment of the human race.

  At the same time, the works of Daniel Kahneman, Amos Tversky, Richard Thaler and many others in the past twenty-five years or so have challenged some of the core assumptions of the rationality of people as economic or calculative beings. Much of their work is in the context of finance theory.

  Why do people behave as they do? With respect to economic behaviour, finance theory does have some answers. Human beings are supposed to be rational in decision-making with regard to their economic choices. Among the assumptions of rationality in economics are that the risk level remaining the same, people expect higher returns; expected return remaining the same, they seek lesser risk; for every incremental unit of risk, they seek at least the same level of return as they sought for the previous unit of risk, and so forth. Economic theory dubs those who act in accordance with these assumptions as ‘rational’ or ‘utility maximizers’. A little reflection reveals that these are not unreasonable assumptions and most people can be termed as rational beings in matters of economic choices.

  What is utility maximization? Normally a child likes sweets and dislikes bitter things, such as medicines. But you may be able to persuade a child to swallow a bitter pill provided you also ply the child with some candies. The more pills you want a child to swallow, the more candies you may have to offer as inducement. If you had to offer two candies to persuade the child to swallow the first bitter pill, it is unlikely that the child will accept anything less than two candies, and probably will want more, for the second bitter bill and so forth. In short, the child will accept a combination of pills and candies in proportions that would satisfy him best. In more technical language, the child is maximizing his utility and hence acting rationally. In the world of investments, returns and risks are to an investor what candies and pills are to a child. That lemming-like investors may well be utility maximizers, and hence rational, was reinforced when certain laboratory experiments found rats to be utility maximizers in the sense assumed by finance theory. See Appendix 1 for details.

  In this respect, game theory is no different. As a theory of social situations, it also assumes that people are rational and coldly calculating. In other words, people are assumed to behave in their own selfish interest. Even an altruist is assumed to do a ‘selfless’ deed only for the happiness and satisfaction he derives from such an action. Hence, he is also assumed to be acting in his own self-interest. Typically, in social dilemmas, one has a choice between doing what is best for oneself and what is best for the group to which one belongs. For example, whether to chuck our kitchen trash at the neighbourhood crossing or walk the extra block to the municipal dump is a dilemma most of us living in this country are familiar with. All of us know that
walking that extra block to the municipal dump is the right thing to do in the interest of the society as a whole. Yet, personally, it seems such a waste of time, considering that the streets are anyway dirty and the kitchen trash of just one more household is unlikely to make much of a difference to the overall sanitation of the city. Why sacrifice one’s self-interest for the sake of the community when one can throw away the trash without any fear of retribution? Selfishness seems to tell each and every Indian that it is entirely rational for us to chuck our trash all around. This results in the huge garbage heap of a country of over one billion people. Clearly, rationality needs a relook.

  OF COURSE WE ARE INTELLIGENT AND RATIONAL

  Rational thinking and intelligence go hand in hand. As the human being is more intelligent than other animals, he is also more rational. As far as intelligence goes, Indians are perhaps second to none in the world. This view, though subjective, is based on several observations.

  For example, I often see how a kid barely into his teens in the neighbourhood vegetable shop does rapid-fire mental maths, so that before you have put half a kilo of this and three-fourth kilo of that, and two and a half kilos of yet another vegetable in the bag, he spits out the final amount you have to pay. Or how a waiter in a dhaba can take orders orally from half a dozen customers simultaneously, with each one ordering three or more dishes, and rarely make a mistake while serving the orders from memory. Or how a roadside mechanic can solve complex mechanical problems with ingeniously improvised tools and solutions. Or how two schoolboys in Bangalore can launch a hand-made rocket.