The Game Theory of Frontier AI - FourWeekMBA
fourweekmba.com
The AI arms race is a textbook game theory trap — and understanding why labs can't stop racing even when it's collectively irrational explains everything about where frontier AI is headed.
Game TheoryPrisoner's DilemmaNash EquilibriumArms Race Dynamics
Theory Briefing
- For three years, frontier AI labs competed in a speed-driven race where shipping the best model fastest meant capturing the entire cycle.
- This dynamic mirrors a classic prisoner's dilemma — each lab defects by racing ahead, even though mutual restraint would benefit everyone.
- As the frontier shifts, the payoff matrix may be changing, forcing labs into new strategic equilibria beyond pure speed competition.