Legal Disputes Resolved via Game Theoretic Methods

Mathematical foundations of conflict resolutions are deeply rooted in the theory of cooperative and non-cooperative games. While many elementary models of conflicts are formalized, one often raises the question whether game theory and its mathematically developed tools are applicable to actual legal disputes in practice. We choose an example from union management conflict on hourly wage dispute and how zero sum two person game theory can be used by a judge to bring about the need for realistic compromises between the two parties. We choose another example from the 2000-year old Babylonian Talmud to describe how a certain debt problem was resolved. While they may be unaware of cooperative game theory, their solution methods are fully consistent with the solution concept called the nucleolus of a TU game.