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Ecologies of Games Shaping Large Technical Systems: Cases from Telecommunications to the Internet

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Innovation Policy and Governance in High-Tech Industries

Abstract

A promising theoretical perspective on the construction of order and change in the evolution of Large Technical Systems (LTS) is offered by ecological approaches in the social sciences. In a multitude of variations, they apply one or more “ecosystem” ideas and related concepts to change and adaptation of social and technical systems. Ecologically inspired models put emphasis on: (1) the dynamic interdependencies and interactions between diverse actors; (2) the multiplicity of relations between the components and outcomes of these systems; and (3) the existence of multiple and relatively autonomous layers and levels in such systems, along with the emergent relations between these levels. In the social sciences, most of these approaches have been developed in the sociology of organizations (population ecology of organizations; organizational ecology). In the political sciences, approaches from this ecological perspective have been applied to understanding the development of local communities, policy sectors, and interest group systems. An under-exploited variant of this perspective is the concept of an “ecology of games”, which emphasizes the complexity of nested (public and private) decision-making processes in the context of tight social and technical interdependencies and related conflicts. This paper describes the foundations of the “ecology of games” as a framework for the study of large technical systems in the communications and information technology sector, and explores its explanatory value to a collection of case studies.

Authors are listed alphabetically to denote an equal contribution to the chapter.

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Notes

  1. 1.

    Rapoport and Guyer (1978) show that a simple game with two players, with two action options, and ordinal payoffs provides for 78 game configurations. These can be classified according to such criteria as the degree of conflict involved, or possible equilibriums. However, only a few games are theoretically interesting in the sense that they involve conflict dilemmas. Games in which actors are able to maximise their individual utility, at the same time as the collective utility is improved, are more trivial and less challenging than games in which ‘motives are mixed’ and strategic choices are more difficult to predict. An interesting result of this taxonomy is that about one quarter of the games are no-conflict games, and only three of the 78 games they identify imply pure conflict configurations, where interests are diametrically opposed.

  2. 2.

    An illustrative example is traditional broadcast radio or television, where all persons in a given area can receive radio and TV emissions, even if they avoid sharing the costs of its provision. Such systems exhibit the basic characteristics of public goods such as non-excludability and non-rivalry in consumption. Since exclusion is technically impossible, everybody can have a “free ride”, and an increasing number of receivers will not impair the quality of emission. The dilemma in this conflict structure is that if everybody free rides, system providers will find it difficult to mobilise the financial resources required for the development and maintenance of the infrastructures.

  3. 3.

    A closely related low conflict game is an “assurance game”, which has been applied to the collective build-up of large technical projects (Schneider 1993). The players have two strategies: to invest into the system, or abstain from contributing resources. Since the resources are specialized, the system setup only succeeds if all partners co-invest. If one player defects the whole project fails and the other system partners lose their investment. As cooperation is voluntary, strategic uncertainty is created for each of the players. However, all know that they will reap substantial profits and gain new business opportunities if the project succeeds. This game is a “no-conflict game” because the players’ interests converge. Although neither player has a dominant strategy, there is an agreed best outcome when all players invest. However, if players seek to minimise maximal losses (maximin strategy), which game theory proposes as a rational strategy in such uncertain constellations, the players would end up in a Pareto-suboptimal equilibrium. But this could be avoided if each player were assured by a collective contract that the others also would invest (Sen 1969).

  4. 4.

    In biology a version of the chicken game is known as a “hawk-dove” game analyzing resource aggressive and peaceful resource sharing behaviour (Samuelson 2002).

  5. 5.

    While this theory was initially framed to analyse change (or absence of change) within organizations, it is perfectly applicable to the genesis and dissemination of scientific and technical discoveries and innovations, as Friedberg recognised.

  6. 6.

    A study of telephone companies in Iowa had similar results. Telecommunications companies extended their systems either by “encroaching on the territories of their neighbours (competition)” or by connecting with each other (commensalism) by the creation of mutalistic organizations (Barnett and Carroll 1987).

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Dutton, W.H., Schneider, V., Vedel, T. (2012). Ecologies of Games Shaping Large Technical Systems: Cases from Telecommunications to the Internet. In: Bauer, J., Lang, A., Schneider, V. (eds) Innovation Policy and Governance in High-Tech Industries. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-12563-8_3

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