Two drivers race toward each other. Swerve and you're "chicken" (lose face but survive).
Stay straight and hope the other swerves, or crash if both stay straight. Anti-coordination with dangerous stakes.
About the Chicken Game
The Scenario: Two drivers race directly toward each other on a collision course. Each must decide to swerve or stay straight. The first to swerve is the "chicken" and loses prestige.
Payoffs:
• Both Straight → CRASH (-10, -10) - Worst outcome for both
• You Straight, They Swerve → You WIN (7, 2) - You gain prestige, they lose face
• You Swerve, They Straight → You LOSE (2, 7) - They gain prestige, you lose face
• Both Swerve → TIE (5, 5) - Mutual caution, moderate outcome
Nash Equilibria: Two pure strategy equilibria where one player swerves and the other goes straight. Also a mixed strategy equilibrium where both randomize (~56% straight).
Anti-Coordination: Unlike coordination games, you want to do the OPPOSITE of your opponent. If they swerve, you should go straight. If they go straight, you should swerve.
Brinkmanship: The key strategic insight is commitment. If you can credibly commit to going straight (e.g., visibly throw away your steering wheel), you force the opponent to swerve.
Real Applications:
• Nuclear deterrence and arms races (mutually assured destruction)
• Labor-management negotiations and strikes
• Price wars between competing firms
• International crises and territorial disputes
The Chicken Game models any situation where both parties want to appear tough, but mutual toughness leads to disaster.