Tuesday, November 25, 2008

What are we doing?? - Part Two

Any system is inherently trust based but always tends towards being distrustful. Consider a prisoners' dilemma example.

(A) = A crook with a bag of jewels
(B) = Another with $100

(A) needs the money and (B) needs the jewels. Now they are both "if you see my face, I'll have to kill you" kind of guys. So they develop a simple system. (A) leaves the money a designated place in the forest and (B) leaves the bag of jewels at another designated place.

If they both co-operate, they leave happy. But life is not so simple, is it?

Once they start losing trust in each other. They will employ various methods, making the system more sophisticated in the process, so as to make sure that they are not tricked. Here's what they could do (this list is not exhaustive ;-) )
  1. (A) decides to send a friend to the place where (B) is supposed to leave the bag to see that (B) does leave the bag
  2. (A) realizes that even if (B) leaves the bag, how will (A) know? So he decides to send two friends, one of whom shall come back and inform (A)
  3. (A) grows suspicious of his two friends, coz they might run away with the jewels, so he has to keep their children as collateral. He appoints a person to guard the children and has to feed them as well.
  4. The friends say that if (B) leaves an empty bag, it's not their fault. Which is fair, so they end up carrying mobile video cameras that transmit back to (A) on his mobile receiver...
... and so on.

Well actually at step 4 (A) goes "All this for $100?? Not worth it at all". Wise decision but if the stakes go higher, (A) will end up investing in the hi-tech solution which only improves his chance of not getting cheated by a fraction. By the way all this while (B) is also employing similar tactics.

So here we have two parties willing to invest in more and more complex systems as long as the stakes seem high enough for them. And here are we, the IT people, who will help them do it.

To be continued...

1 comment:

  1. Alternatively, the crook with the jewels can drop off the jewels in small batches, even a jewel at a time, so that in order for the transaction to be completed, the intermediate transactions have to complete.

    I don't know if this helps your analogy, but I thought it'd be fun to add in my solution.

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