Is Rock-Paper-Scissors a good way to settle things?
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“…it is often efficient for minor conflicts while it performs no better than a coin-flip for major conflicts.”
Rock Paper Scissors is used to resolve conflict when a compromise is not possible. Individuals playing “games” tend to have biases they prefer to play. I show that Rock Paper Scissors with biased players results in a player with a high valuation for winning being victorious with a probability greater than a player with a low valuation. Thus, it frequently achieves the efficient outcome. Furthermore, as the benefit to victory increases for all players, victory for each player becomes equally likely. Therefore, it is often efficient for minor conflicts while it performs no better than a coin-flip for major conflicts.
Source: “Rock Paper Scissors”, Journal of Economics, Volume 92, Number 1, 67-88
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