Nuclear Deterrence Policy and Responsible Retailing:

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Nuclear Deterrence Policy and Responsible
Retailing     Brad S.
Krevor, Ph.D. Schneider Institute for Health
Policy, The Heller School for Social Policy
and Management, Brandeis University
The application of game theory to predict
outcomes among cooperating and non-cooperating
parties as a paradigm for Responsible Retailing
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I. Game Theory

• Game theory is the study of interactive
  decision-making in the sense that those involved
  are affected by their own choices and by the
  decisions of others. Larry Samuelson

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I. Game Theory

• Game theory is the study of interactive
  decision-making in the sense that those involved
  are affected by their own choices and by the
  decisions of others.
• Larry Samuelson
• Games are the theoretical models of conflicts of
  interest
• C. Thomas

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I. Game Theory

• Game theory is the study of interactive
  decision-making in the sense that those involved
  are affected by their own choices and by the
  decisions of others.
• Larry Samuelson
• Games are the theoretical models of conflicts of
  interest C. Thomas

• Game theory analyzes interactions between agents
  and formulates hypotheses about their behavior
  and final outcomes

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I. Game Theory

• Game theory is the study of interactive
  decision-making in the sense that those involved
  are affected by their own choices and by the
  decisions of others.
• Larry Samuelson
• Games are the theoretical models of conflicts of
  interest C. Thomas

• Game theory analyzes interactions between agents
  and formulates hypotheses about their behavior
  and final outcomes
• Game theory can be used to study how parties will
  behave . . .
• . . . or how parties should behave

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I. The Vocabulary of Game Theory

• Games may be co-operative ( in which players
  work together or players merely share, or
  signal, information) or non-cooperative

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I. The Vocabulary of Game Theory

• Games may be co-operative (in which players
  work together or players merely share, or
  signal, information) or non-cooperative

• Players are assumed to act individually
  rationally, i.e. they will choose outcomes which
  are in their own best interest

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I. The Vocabulary of Game Theory

• Games may be co-operative (in which players
  work together or players merely share, or
  signal, information) or non-cooperative

• Players are assumed to act individually
  rationally, i.e. they will choose outcomes which
  are in their own best interest

• Players may act co-operatively (doves) or
  non-cooperatively (hawks) but even when acting
  co-operatively, players are acting individually
  rationally, i.e. are motivated by self-interest

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I. The Vocabulary of Game Theory

• Games may be co-operative (in which players
  work together or players merely share, or
  signal, information) or non-cooperative

• Players are assumed to act individually
  rationally, i.e. they will choose outcomes which
  are in their own best interest

• Players may act co-operatively (doves) or
  non-cooperatively (hawks) but even when acting
  co-operatively, players are acting individually
  rationally, i.e. are motivated by self-interest

• Utility or Pay-off are the value of an
  outcome measured in units

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I. The Vocabulary of Game Theory

• Games may be co-operative (in which players
  work together or players merely share, or
  signal, information) or non-cooperative

• Players are assumed to act individually
  rationally, i.e. they will choose outcomes which
  are in their own best interest

• Players may act co-operatively (doves) or
  non-cooperatively (hawks) but even when acting
  co-operatively, players are acting individually
  rationally, i.e. are motivated by self-interest

• Utility or Pay-off are the value of an
  outcome measured in units

• Games may be zero-sum (winner/ loser) or non
  zero-sum

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II. Examples of Games

• Prisoners Dilemma 2 people who have committed a
  crime have been caught. In the absence of proof
  of guilt, the police offer this choice

• TV version

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II. Examples of Games

• Prisoners Dilemma 2 people who have committed a
  crime have been caught. In the absence of proof
  of guilt, the police offer this choice

• TV version
• Original version
• a. If you confess and your accomplice fails to
  confess, you get the minimum (payoff -5)

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II. Examples of Games
Prisoners Dilemma 2 people who have committed a
crime have been caught. In the absence of proof
of guilt, the police offer this choice

• TV version
• Original version
• a. If you confess and your accomplice fails to
  confess, you get the minimum (payoff -5)

• b. If you fail to confess but your accomplice
  confesses, you will be convicted and receive the
  maximum sentence (payoff -15)

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II. Examples of Games
Prisoners Dilemma 2 people who have committed a
crime have been caught. In the absence of proof
of guilt, the police offer this choice

• TV version
• Original version
• a. If you confess and your accomplice fails to
  confess, you get the minimum (payoff -5)
• b. If you fail to confess but your accomplish
  confesses, you will be convicted and receive the
  maximum sentence (-15)

• c. If you both confess, then you both will be
  convicted but not receive maximum sentences
  (payoff -8)

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II. Examples of Games
Prisoners Dilemma 2 people who have committed a
crime have been caught. In the absence of proof
of guilt, the police offer this choice

• TV version
• Original version
• a. If you confess and your accomplice fails to
  confess, you get the minimum (payoff -5)
• b. If you fail to confess but your accomplish
  confesses, you will be convicted and receive the
  maximum sentence (-15)
• c. If you both confess, then you both will be
  convicted but not receive maximum sentences (-8)

• d. If neither of you confesses, then you will be
  convicted of possessing stolen property and will
  receive a certain conviction (payoff -1)

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II. Examples of Games

• Prisoners Dilemma 2 people who have committed a
  crime have been caught. In the absence of proof
  of guilt, the police offer this choice
• TV version
• Original version
• a. If you confess and your accomplice fails to
  confess, you get the minimum (payoff -5)
• b. If you fail to confess but your accomplish
  confesses, you will be convicted and receive the
  maximum sentence (-15)
• c. If you both confess, then you both will be
  convicted but not receive maximum sentences (-8)
• d. If neither of you confesses, then you will be
  convicted of possessing stolen property and will
  receive a certain conviction (-1)

Best payoff (-1) is not to confess (d) but this
risks payoff of 15 (b). Confession brings payoff
of either 5 (a) or 8 (c) but avoids 15 (b)
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II. Examples of Games (cont.)

• Stag Hunt Killing a stag, which requires 2
  players, has a high utility (payoff 10). A
  hare can be captured by only 1 player but has a
  low utility (payoff 2). If 2 players attempt to
  trap a hare, however, the hare will be scared off
  and escape.

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II. Examples of Games (cont.)

• Stag Hunt Killing a stag, which requires 2
  players, has a high utility (payoff 10). A
  hare can be captured by only 1 player but has a
  low utility (payoff 2). If 2 players attempt to
  trap a hare, however, the hare will be scared off
  and escape.
• Both players agree to hunt the stag and separate
  in search of the stag. Each then has the
  opportunity to stick with the plan (dove) or
  deviate from the plan (hawk).
• Is it in the interest of either player to
  deviate from that agreement and hunt the hare?

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II. Examples of Games (cont.)

• Stag hunt Killing a stag, which requires 2
  players, has a high utility (payoff of 10). A
  hare can be captured by only 1 player but has a
  low utility (payoff of 2). If 2 players attempt
  to trap a hare, however, the hare will be scared
  off and escape.
• Both players agree to hunt the stag and separate
  in search of the stag. Each then has the
  opportunity to stick with the plan (dove) or
  deviate from the plan (hawk). Is it in the
  interest of either player to deviate from that
  agreement and hunt the hare?
• If one player chooses to deviate (Hawk), it in
  the interest of that player that the other player
  not know of the deviation, since the hare will
  escape if both players try to capture it.

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Nash Equilibrium

• A Nash Equilibrium A collection of
  strategies, one for each player, that are mutual
  best replies in the sense that each agents
  strategy is optimal given the strategies of the
  other agents

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Nash Equilibrium

• A Nash Equilibrium is a collection of strategies,
  one for each player, that are mutual best replies
  in the sense that each agents strategy is
  optimal given the strategies of the other agents
• A Nash Equilibrium demonstrates that no player
  has an incentive to deviate from his strategy
  given that the other players dont deviate

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Game Theory Applications
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II. Economic Applications
Convenience Store Game Store A is considering
entering a market (or introducing a product)
which is served (or produced) exclusively by
Store B, and whose total value 4. If A enters
the market, B can either acquiesce or retaliate.
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II. Economic Applications
Convenience Store Game Store A is considering
entering a market (or introducing a product)
which is served (or produced) exclusively by
Store B, and whose total value 4. If A enters
the market, B can either acquiesce or retaliate.

• If A declines to enter, As payoff 0 and Bs
  payoff 4

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II. Economic Applications
Convenience Store Game Store A is considering
entering a market (or introducing a product)
which is served (or produced) exclusively by
Store B, and whose total value 4. If A enters
the market, B can either acquiesce or retaliate.

• If A declines to enter, As payoff 0 and Bs
  payoff 4

• If A enters the market and B acquiesces, they
  share the market and each receives a payoff of 2

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II. Economic Applications
Convenience Store Game Store A is considering
entering a market (or introducing a product)
which is served (or produced) exclusively by
Store B, and whose total value 4. If A enters
the market, B can either acquiesce or retaliate.

• If A declines to enter, As payoff 0 and Bs
  payoff 4

• If A enters the market and B acquiesces, they
  share the market and each receives a payoff of 2

• If A enters the market and B retaliates with
  severe price reductions, they each receive a
  payoff of 4

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II. Environmental Applications
Applied to regional, national and international
policies (laws or treaties) to reduce pollution,
regulate fishing rights, etc. Freeloader
phenomenon

• The cost to a player (e.g., an industrial plant,
  a state or a nation) of abating the production of
  pollution is very high

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II. Environmental Applications
Applied to regional, national and international
policies (laws or treaties) to reduce pollution
Freeloader phenomenon

• The cost to a player (e.g., an industrial plant,
  a state or a nation) of abating the production of
  pollution is very high
• However, the contribution of that player to the
  problem of the region (or country or world) is
  marginal and the benefit to that player for
  abatement may be marginal or 0.

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II. Environmental Applications
Applied to regional, national and international
policies (laws or treaties) to reduce pollution
Freeloader phenomenon

• The cost to a player (e.g., an industrial plant,
  a state or a nation) of abating the production of
  pollution is very high
• However, the contribution of that player to the
  problem of the region (or country or world) is
  marginal as may be the benefit to that player
  for abatement
• optimal payoff the pollution-creating problem is
  
• abated . . . with other players absorbing all or
  a
• disproportionately higher percentage of the cost!

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II. Military Applications

• War Games

• intensive development following WWII
• zero-sum games winners and losers
• non-cooperating game

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II. Military Applications

• War Games

• intensive development following WWII
• zero-sum games winners and losers
• non-cooperating game
• M.A.D. Mutually Assured Destruction
• -- a Nash Equilibrium neither player has an
  incentive to deviate (i.e., use nuclear weapons)
  unless the other player deviates

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II. Military Applications (cont.)

• Nuclear treaties
• Freezing, or reducing, nuclear arsenals deemed
  to be desirable -- possible only if both sides
  act
• Mathematica group

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II. Military Applications (cont.)

• Nuclear treaties
• Rothchild and Waterloo potential disadvantage
  of co-operation

How does one signal information when
communicating what you are willing to agree to in
a treaty gives the other side a bargaining
advantage?
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III. Structural Problems of Responsible Retailing
Before applying game theory principals to
Responsible Retailing

• What are the Structural Problems of Responsible
  Retailing the obstacles at the national (and
  state) level, at the level of individual
  communities, and at the level of individual
  stores -- which impede efforts to prevent
  underage sales?

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III. Structural Problems at the State (and
National) Level
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Structural Problems State/ National
1. Divergent objectives of RR stakeholders
Retailers
Enforcement Agencies
AGs
Wholesalers and Distributors
CSAP
Public Health Depts. Foundations
Producers
Advocates and Voluntaries
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Structural Problems State/ National
1. Divergent objectives profit vs. public
interest
Enforcement Agencies
Retailers
AGs
CSAP
Wholesalers and Distributors
Public Health Depts. Foundations
Producers
Advocates and Voluntaries
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Structural Problems State/ National
2. Perceived motives motives attributed to some
stakeholders (players) by other stakeholders
(players)
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Structural Problems State/ National
2. Perceived by retailers

• We are being asked to serve as agents of public
  health. (e.g. No Buts criticism of We
  Card)

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Structural Problems State/ National
2. Perceived by retailers

• We are being asked to serve as agents of public
  health. (e.g. No Buts criticism of We
  Card)
• Tobacco and alcohol advocates are
  neo-prohibitionists.

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Structural Problems State/ National

• 2. Perceived by public health/ advocates

• Responsible retailing is only PR

AGs
CSAP
Public Health Depts. Foundations
Advocates and Voluntaries
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Structural Problems State/ National

• 2. Perceived by public health/ advocates

• Responsible retailing is only PR to buy
  respectability
• RR always lt marketing!

AGs
CSAP
Public Health Depts. Foundations
Advocates and Voluntaries
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Structural Problems State/ National

• 2. Perceived by public health/ advocates

• Responsible retailing is only PR to buy
  respectability
• RR always lt marketing!

AGs

• Matt Myers, Campaign for Tobacco-Free Kids

CSAP
Public Health Depts. Foundations
Advocates and Voluntaries
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Structural Problems State/ National

• 2. Perceived by public health/ advocates

• Ed Sweda, Jr. TCRC
• Responsible retailing is only PR to buy
  respectability
• RR always lt marketing!

AGs

• Matt Myers, Campaign for Tobacco-Free Kids

CSAP

• Enforcement agencies arent really committed!

Public Health Depts. Foundations
Advocates and Voluntaries
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Structural Problems State/ National

• 3. Enmity and mistrust

• Unwillingness to work together
• AMA
• anonymous researcher
• PA sales certification program

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Structural Problems State/ National

• 3. Enmity and mistrust

Brandeis compliance project

• specific protocol for vendors

• if followed, 1.5 million premature deaths will be
  avoided
• non-compliance rate of 40 - 50

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Structural Problems State/ National

• 3. Enmity and mistrust

Brandeis compliance project

• specific protocol for vendors

• if followed, 1.5 million premature deaths will be
  avoided
• non-compliance rate of 40 - 50

• vendor explanations

• too busy
• avoid confrontation
• following protocol doesnt work it wont solve
  the problem

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Structural Problems State/ National

• 3. Enmity and mistrust

Brandeis compliance project

• Vendors Family Physicians

• Protocol PHS Clinical Guidelines
• HEDIS 50 - 60 of patients not counseled

• Vendor explanations

• too busy
• avoid confrontation
• following protocol doesnt work it wont solve
  the problem

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Structural Problems State/ National
4. Absence of Research

• Retailers not in corporate culture
• Public health community unwilling
• Enforcement community

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Structural Problems Community
1. Compliance rates are overestimated
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Structural Problems Community
1. Compliance rates are overestimated

• Brandeis EAV study
• -- double vs. single inspection protocol

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Structural Problems Community
1. Compliance rates are overestimated

• Brandeis EAV study
• -- double vs. single inspection protocol

Tobacco Inspections Baseline 1 Compliance Baseline 2 Compliance Compliant B1 B2
Florida 81 86 66
Iowa 43 51 33
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Structural Problems Community
1. Compliance rates are overestimated

• Brandeis EAV study

DiFranza UMASS study pairs of inspectors,
identical in all but one respect, attempt
purchases of tobacco (in alternating order) in
160 stores in 8 Massachusetts communities, all
with measured compliance rates gt 90
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Structural Problems Community
2. Policies do not translate into compliance
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Structural Problems Community
2. Policies do not translate into compliance

• Christine Milliken, NAAG
• tobacco-ization of alcohol

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Structural Problems Community
2. Policies do not translate into compliance

• Christine Milliken, NAAG
• tobacco-ization of alcohol
• Attorneys General Consumer Protection initiative
• alcohol-ization of tobacco

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Structural Problems Community
2. Policies do not translate into compliance

• Christine Milliken, NAAG
• tobacco-ization of alcohol
• Attorneys General Consumer Protection initiative
• alcohol-ization of tobacco

There must be strong, explicit policies but
these policies tend not to be performed
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Structural Problems Community
2. Policies do not translate into compliance

• Walgreens age verification
• Before AVC, ID everyone lt age 30
• low
  compliance

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Structural Problems Community
2. Policies do not translate into compliance

• Walgreens age verification
• Before AVC, ID everyone lt age 30
• After AVC, ID everyone lt age 40, i.e.
• a 17 yr old looked gt 30 but not gt 39
• low
  compliance

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Structural Problems Community
2. Policies do not translate into compliance

• Walgreens age verification
• Before AVC, ID everyone lt age 30
• After AVC, ID everyone lt age 40, i.e.
• a 17 yr old looked gt 30 but not gt 39

• Then, ID everyone, i.e.
• a 17 yr old looked gt 40, or
• a clerk will be more willing to ID a 17 yr old if
  the clerk also must now ID a 60 yr old!

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Structural Problems Community

• 3. Paradox of enforcement

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Structural Problems Community

• 3. Paradox of enforcement

• Enforcement is sine qua non of compliance but
  enforcement has limits

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Structural Problems Community

• 3. Paradox of enforcement

• Enforcement is sine qua non of compliance but
  enforcement has limits
• Enforcement shifts illegal sales from major
  chains to independent retailers (MN EAV study)

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Structural Problems Community

• 3. Paradox of enforcement

• Enforcement is sine qua non of compliance but
  enforcement has limits
• Enforcement shifts illegal sales from major
  chains to independent retailers (MN EAV study)
• Compliance with sales to minors laws also shifts
  acquisition by minors from commercial to social
  sources

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Structural Problems Community

• 3. Paradox of enforcement

• Enforcement is sine qua non of compliance but
  enforcement has limits
• Enforcement shifts illegal sales from major
  chains to independent retailers (MN EAV study)
• Compliance with sales to minors laws also shifts
  acquisition by minors from commercial to social
  sources
• Moving vs. stationary targets

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Structural Problems Community

• 3. Paradox of enforcement

• Enforcement is sine qua non of compliance but
  enforcement has limits
• Enforcement shifts illegal sales from major
  chains to independent retailers (MN EAV study)
• Compliance with sales to minors laws also shifts
  acquisition by minors from commercial to social
  sources
• Moving vs. stationary targets
• Even at 90 - 95 compliance, minors can purchase
  alcohol and tobacco

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Structural Problems Store
1. Clerk characteristics
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Structural Problems Store
1. Clerk characteristics

• Turnover gt than frequency of inspections
• No incentive to comply
• Little or no loyalty to employer
• Young clerks more apt to sell
• Willful collusion

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Structural Problems Store
2. Clerk, not store policy, predictive of store
compliance
EAV study

• Inconsistency of store compliance
• multitude of individual attitudes determines
  whether clerk adheres to store policy

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Structural Problems Store
2. Clerk, not store policy, predictive of store
compliance
EAV study

• Inconsistency of store compliance
• multitude of individual attitudes determines
  whether clerk adheres to store policy

Challenge of Responsible Retailing How do stores
produce organizational and behavioral change?
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Structural Problems Store
2. Clerk, not store policy, predictive of store
compliance
Challenge of Responsible Retailing How do stores
produce organizational and behavioral
change? Autumn Thomas Identify new corporate
models
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Structural Problems Store
Big Mac and Large Fries? Yes, Sir!
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Structural Problems Store
But could you first step on the scale, sir?
and show me your cholesterol report?
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Structural Problems Store
Im so sorry. But could I interest you in a
Diet Coke and Chicken Sandwich?
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Structural Problems Store
3. Aversion to confrontation
McDonalds has no confrontation!
Also The person who seeks a job at McDonalds
may well be different in many ways from the
person who seeks a job at ABC Wine and Spirits or
at Store 24. Bill de Jong, Higher Education
Center
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IV. Game Theory Applications Learnings for
Responsible Retailing

• Pollution abatement models
• Convenience store models
• Prisoners Dilemma
• War Games

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Learnings from Game Theory (cont.)

• Pollution abatement models
• abate make investments in Best Practices
  playerretailer

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Learnings from Game Theory (cont.)

• Pollution abatement models
• abate make investments in Best Practices
  playerretailer

• In absence of enforcement (penalties), the
  problem will persist

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Learnings from Game Theory (cont.)

• Pollution abatement models
• abate make investments in Best Practices
  playerretailer

• In absence of enforcement (penalties), the
  problem will persist
• No incentive for 1 player to abate problem unless
  all players take similar measures. Abatement may
  actually cause competitive disadvantage

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Learnings from Game Theory (cont.)

• Pollution abatement models
• abate make investments in Best Practices
  playerretailer

• In absence of enforcement (penalties), the
  problem will persist
• No incentive for 1 player to abate problem unless
  all players take similar measures. Abatement may
  actually cause competitive disadvantage
• Freeloader effect will occur if some stores
  (typically large chains) invest in abatement
  while others do not. Only abatement by all
  players will eliminate free-loader effect

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Learnings from Game Theory (cont.)
2. Convenience store models
Replace enter market with remain in market

• What would be the incentive (payoff) to remain in
  the market, or to withdraw from the market, if
  each player were forced to incur the cost of
  implementing comprehensive responsible retailing
  practices?
• How many casual players would withdraw?

82
Learnings from Game Theory (cont.)
2. Convenience store models
Replace enter market with remain in market

• What would be the incentive (payoff) to remain in
  the market, or to withdraw from the market, if
  each player were forced to incur the cost of
  implementing comprehensive responsible retailing
  practices?
• How many casual players would withdraw?

Higher cost for each remaining player may boost
revenues and profitability by concentrating market
83
Learnings from Game Theory (cont.)

• 3. Prisoners Dilemma
• The best possible outcome in this non-cooperating
  game is worse than could be achieved through
  co-operation

84
Learnings from Game Theory (cont.)
4. War Games co-operative solutions can be
produced in non-cooperative games acting out of
individual self-interest, diverse stakeholders
can arrive at a co-operative solution
85
Learnings from Game Theory (cont.)
4. War Games co-operative solutions can be
produced in non-cooperative games acting out of
individual self-interest, diverse stakeholders
can arrive at a co-operative solution
Responsible retailing is not an irreconcilable
structural conflict co-operative efforts to
establish responsible retailing practices can be
a best strategy a Nash equilibrium
86
Learnings from Game Theory (cont.)
5. Nash equilibrium A collection of strategies,
one for each player, that are mutual best replies
in the sense that each agents strategy is
optimal given the strategies of the other agents
87
Learnings from Game Theory (cont.)
5. Nash equilibrium

• Best strategy for public health agencies/
  advocates
• given
• private stakeholder propensity to lobby to keep
  penalties for non-compliance low, and
• community and judicial lassitude re underage
  sales . . .

88
Learnings from Game Theory (cont.)
5. Nash equilibrium
Best strategy for public health agencies/
advocates
is to shift social norms activism to heighten
public concern so as to produce enhanced
regulatory, enforcement, judicial and retailer
actions.
89
Learnings from Game Theory (cont.)
5. Nash equilibrium

• Best strategy for regulatory and enforcement
  agencies
• given
• public health and advocacy pressure to reduce
  underage sales / use of tobacco and alcohol
  products, and
• retailer profit motive (i.e. unwillingness to
  incur the costs of abatement voluntarily and
  without all players also absorbing those
  costs)

90
Learnings from Game Theory (cont.)
5. Nash equilibrium
Best strategy for regulatory and enforcement
agencies
is to conduct frequent enforcement inspections
(and consumer protection actions).
91
Learnings from Game Theory (cont.)
5. Nash equilibrium

• Best strategy for retailers and retail
  associations
• given
• public health and advocacy pressure for retailers
  to reduce underage sales, and
• frequent inspections by enforcement agencies

92
Learnings from Game Theory (cont.)
5. Nash equilibrium
Best strategy for retailers and retail
associations is to
i. invest in Responsible Retailing practices so
as to avoid fines/ license suspensions and
Attorney General consumer protection actions, and
93
Learnings from Game Theory (cont.)
5. Nash equilibrium
Best strategy for retailers and retail
associations are to
i. invest in Responsible Retailing practices so
as to avoid fines/ license suspensions and
Attorney General consumer protection actions, and
ii. Work at both the state and community level to
insure that all retailers comply with high
Respon-sible Retailing standards so as to
eliminate the competitive disadvantage caused by
the free-loader effect
94
V. Fall-Out from Non-Cooperation
1. Policy

• Non-Standardization of IDs
• EAV and uniformity of codes
• MA license
• only (this state) license is accepted
• Affirmative defense in OH, CT and NY

95
V. Fall-Out from Non-Cooperation
1. Policy

• Non-Standardization of ID
• Harsh penalties without remedial actions
• (Wagenaar principle)

96
V. Fall-Out from Non-Cooperation
1. Policy

• Non-Standardization of IDs
• Harsh penalties without remedial actions
• Health component in clerk/ server training

97
V. Fall-Out from Non-Cooperation
1. Policy

• Non-Standardization of IDs
• Harsh penalties without remedial actions
• Health component in clerk/ server training
• Possession laws/ cops and shops

98
V. Fall-Out from Non-Cooperation
1. Policy

• Non-Standardization of IDs
• Harsh penalties without remedial actions
• Health component in clerk/ server training
• Possession laws/ cops and shops
• Parental role

99
V. Fall-Out from Non-Cooperation
2. Allocation of resources
100
V. Fall-Out from Non-Cooperation
2. Allocation of resources

• Duplication
• e.g. New Mexico retailer training
• inconsistencies between tobacco and alcohol laws

101
V. Fall-Out from Non-Cooperation
2. Allocation of resources

• Duplication
• Enforcement
• a. with what frequency?
• b. saturation or selective?
• c. all stores equally?
• d. re-inspections?
• e. is tobacco a proxy for alcohol?

102
V. Fall-Out from Non-Cooperation
2. Allocation of resources

• Duplication
• Enforcement
• Retailers dont co-operate

103
VI. Summary

1. Game theory illustrates that

104
VI. Summary

1. Game theory illustrates that

• Outcomes for each stakeholder are worse through
  non-cooperation

105
VI. Summary

1. Game theory illustrates that

• Outcomes for each stakeholder are worse through
  non-cooperation

• Acting out of their own self-interest,
  stakeholders can arrive at co-operative
  solutionseven in non-cooperative games.

106
VI. Summary

1. Game theory illustrates that

• Outcomes for each stakeholder are worse through
  non-cooperation
• Acting out of their own self-interest,
  stakeholders can arrive at co-operative solutions

• The Nash Equilibrium for stakeholders involves
  efforts to shift social norms, aggressive
  enforcement and universal adherence to
  comprehensive RR practices

107
VI. Summary
2. Structural problems of RR exist at the level
of store, community and state (and nation)
108
VI. Summary
2. Structural problems of RR exist at the level
of store, community and state (and nation)

• No single stakeholder, acting individually, can
  eliminate these structural problems

109
VI. Summary
2. Structural problems of RR exist at the level
of store, community and state (and nation)

• No single stakeholder, acting individually, can
  eliminate these structural problems

• Acting co-operatively (i.e. working together or,
  at very least, sharing information), diverse
  stake-holders can produce co-operative solutions

110
Nuclear Deterrence Policy and Responsible
Retailing     Brad S.
Krevor, Ph.D. Schneider Institute for Health
Policy, The Heller School for Social Policy
and Management, Brandeis University