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One notable example is the [[prisoner's dilemma]], in which the Nash equilibrium is a sub-optimal (non-[[Pareto optimal]]) result that could be improved if both participants cooperated and changed their decisions (by neither confessing to the crime). But left on his own, no single participant would change his decision because he would be individually worse off for doing so.

One notable example is the [[prisoner's dilemma]], in which the Nash equilibrium is a sub-optimal (non-[[Pareto optimal]]) result that could be improved if both participants cooperated and changed their decisions (by neither confessing to the crime). But left on his own, no single participant would change his decision because he would be individually worse off for doing so.

Observe that in situations where the Nash equilibrium fails to attain the most efficient outcome for the individual participants, it does deliver the most benefits to the customer (in the case of an oligopoly) or to the prosecutor (in the case of the [[Prisoner's dilemma]]).

Observe that in situations where the Nash equilibrium fails to attain the most efficient outcome for the individual participants, it does deliver the most benefits to the customer (in the case of an oligopoly) or to the prosecutor (in the case of the [[prisoner's dilemma]]).

[[category:mathematics]]

[[category:mathematics]]

[[category:economics]]

[[category:economics]]