Game Theory and Pay to Play

Game theory is a branch of mathematics concerned with testing behavioral systems in competitive situations where the outcome of a participant’s choice of action depends critically on the actions of other participants. A popular game that tests the efficiency and success rates of different behavioral algorithms is called the public goods game, the scenario is as follows:

“The public goods game is a standard of experimental economics. In the basic game, subjects secretly choose how many of their private tokens to put into a public pot. The tokens in this pot are multiplied by a factor (greater than one and less than the number of players, N) and this “public good” payoff is evenly divided among players. Each subject also keeps the tokens they do not contribute.”

This situation plays itself out daily in myriad situations. In our case as event producers and artists, our dilemma involves cooperating with pay to play for a short term gain that damages the industry as a whole, which is equivalent to holding on to your tokens while others put money in the pot. When played out repeatedly initial cooperation eventually breaks down. As everyone begins to game the system, fewer and fewer tokens make it to the center of the pot and everybody suffers. When you introduce a new element that allows participants to see who is gaming the system and punish them, what tends to happen is a complete correction of the system.

We know which shows are pay to play and which bands are playing them. We know who is producing these shows and what venues are hosting them. We have the necessary information to address cooperation among our peers and pay to play. We have to hold each other accountable and refuse to support elements claiming an anti-corruption ethos while simultaneously cooperating with the very system they claim to be fighting.

The most successful algorithm is not the most severe nor the most forgiving but one that starts off by assuming cooperation with the public goods and punishes selfish behavior but also forgives in subsequent rounds. Since we are limited in our ability to “punish” offenders what we can do is support each other and retract that support when our peers stray from the movement. If we can effectively carry out that behavioral system, we will starve pay to play. Success then depends on participation by as much of the music community as possible.

The beauty of the age that we are living in is that we can test ethical situations and find a way to make cooperating with corruption an unprofitable enterprise. As a final word of warning it is important to note that without an element of punishment, the public goods game almost always unravels completely. If we don’t support each other and withdraw that support when the time comes, we can expect the downward spiral of our movement at worst and its total stagnation at best.

We can ignore whatever may be gained in the short term by keeping focused on a greater victory over a longer course of time. We can overcome the corruption of the industry. We can and we will.

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