Political scientist has worked with businesses, government agencies
Want to learn how to predict outcomes? New York University political science professor Bruce Bueno de Mesquita talked about his new book, “The Predictioneer’s Game,” and showed USC Saturday night how he forecasts foreign affairs outcomes by using game theory and analyzing people‘s self-interests.
Students, faculty and the general public breezed into the Gambrell Auditorium to see Bueno de Mesquita, who helped make decisions with the CIA and Fortune 500 companies and appeared in The Wall Street Journal, The New York Times and Jon Stewart’s “The Daily Show.”
“Everyone wants to be able to predict the future and people have invented an incredible array of ways to predict the future,” Bueno de Mesquita said.
Horoscopes, oracles, tea leaves and stargazing, he said, have the same key feature in common: They don’t work.
Bueno de Mesquita argued that game theory, the study of mathematical models of conflict and cooperation between intelligent rational decision-makers, actually works and makes simple, yet controversial, assumptions that people act in their own best interests.
“People are interested in doing what is good for them,” he said. “They have beliefs and values. There are things they want in the world.”
Game theory finds optimal solutions to problems and helps solve disputes, de Mesquita said.
He added that through game theory, people can engineer social outcomes to make them more aligned with what they like.
Bueno de Mesquita said there are also five variables that come into play when crafting predictions: who has a stake in the decision, do they say what they want to get, are they focused on one issue or several, how persuasive could potential influences be and is the agreement more valuable than the outcome.
Interviews are also conducted to gather data.
Combining these factors, Bueno de Mesquita uses a computer model to calculate outcomes.
His students used his model to project predictions about Pakistan.
According to Bueno de Mesquita they predicted in January 2008 that Pakistan would make agreements with militant groups such as the Taliban or al-Qaida. Months later, reports circulated that Taliban and al-Qaida fighters were relocating to the Pakistani tribal regions.
During his presentation, Bueno de Mesquita used his formula to predict that economic sanctions alone will not deter Iran from continuing their nuclear energy build-up.
With North Korea, he said that the United States will need to give them $1 billion annually to assist those in poverty, and that North Korea will need to disable its nuclear program.
“This (agreement) is self-enforcing,” he said. “Neither side is going to trust the other.”
The system is not perfect, however. Although he strongly believes in it, Bueno de Mesquita admitted that it is 90 percent accurate, citing numerous reasons for the 10 percent inaccuracy.
“The biggest source of inaccuracy is shock — a key decision-maker drops dead,” he said. “Lousy data is another source.”
Bueno de Mesquita’s words were “all new” to Doris Hernandez, a second-year international studies and Spanish student.
“We’re covering [Iran and North Korea] in my foreign policy class,” Hernandez said. “It was neat to hear it.”
Pennsylvania State political science professor Phillip Schrodt agreed with Bueno de Mesquita, attesting that political decision making is no simple task.
“Most people think that people just sit around at the table and talk,” he said. “There’s a lot of technical forecasting to be made.”