A recent paper by Press (of "Numerical Recipes" fame) and Dyson (of the vacuum cleaner commercials Institute for Advanced Studies at Princeton) - http://www.pnas.org/...06569109.abstract (see the free link for the paper on the upper right).

I don't grok all the mathematics any more (if I ever fully did), but it's an entertaining read.

Now consider Y’s perspective, if he has a theory of mind about X. His only alternative to accepting positive, but meager, rewards is to refuse them, hurting both himself and X. He does this in the hope that X will eventually reduce her extortion factor. However, if she has gone to lunch, then his resistance is futile.

(via Brad DeLong - http://delong.typepa...a-strategies.html )

Cheers,
Scott.