The Hindu Business Line : Jumping traffic

Picture this. Your car is caught in a long line-up at a traffic signal in a narrow street. Would you jump into the opposite lane and drive to the front, quite oblivious to the incoming traffic? If yes, you are as self-centred as most of us are when it comes to driving through the traffic. This behaviour is not Pareto-optimal. What does that mean? An outcome is Pareto-optimal if there is no other outcome that makes a person better off without making somebody else worse off. The traffic we face everyday is far from being so.

A norm, not an exception

Typically, you are not the only one jumping lane. It is a norm rather than an exception. If many vehicles step into the opposite lane just as you do, no traffic will flow from that direction. And often that means the vehicles on your side will not move either.

So, why do people indulge in such self-defeating process? It is a classic case of what game theorists call as the Prisoner’s Dilemma. Suppose there are 10 vehicles ahead of you at the signal. You decide to pull behind the tenth vehicle. The one behind you has the incentive to jump the traffic and move to the opposite lane.

Disobeying rules

If everyone obeys the rules, the incentive to jump lane is high. So, everyone jumps lane so as not to be left out, leading to a gridlock. It is not that only drivers engage in such self-defeating process. Have you ever stood in front of a lift door waiting to jump-in the moment the lift stops at your floor? It is the same self-defeating process at work. How?

Everyone, like you, wants to be first to board the lift. But if all of you stand in the way, passengers already in cannot get out. And that delays your journey.

We, therefore, need a system that penalises people who do not obey rules. We also need to be less self-centred and believe others will be too! That could reduce gridlocks and inch us towards Pareto optimality.

(The author is an investment strategist.)

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