Chicken Game
An anti-coordination game where both players prefer to yield if the other stays the course.
Definition
Payoffs : mutual swerve , one yields , mutual crash .
Two pure Nash equilibria (one yields, the other does not) and one mixed.
Intuition
Commitment or bluster can force the rival to yield.
Miscoordination is catastrophic — both "holding" leads to disaster.
Worked example
Cuban Missile Crisis is a textbook application: two nuclear powers on a collision course.
Legislative budget standoffs exhibit chicken-style brinkmanship.
The math
Schelling (1960): visible commitment — such as throwing away your steering wheel — is a rational move that shifts the equilibrium in your favor.
Correlated equilibrium strictly improves average welfare over all Nash equilibria.
Where it is used
The 1962 Cuban Missile Crisis is the definitive Chicken game: the US and USSR each preferred the other to back down, but mutual escalation meant nuclear war. Kennedy's naval blockade was a calibrated move short of full, irreversible commitment.
In labor disputes, both union and management may threaten a strike or lockout — each hoping the other will concede first. The risk is that both hold firm and the resulting work stoppage hurts everyone, just like a crash in Chicken.
More in Game theory
Assembled from the ReLU.chat curated knowledge base. These explanations are concise on purpose; check the sources for anything important.