Swine Flu and Hand-Shaking: A Question from the Final Exam
By Bryan Caplan
Here’s a question from my final exam for Ph.D. Micro. Care to give it a try in the comments?
greeting other people is a special kind of Coordination game. We are in the equilibrium where everyone
shakes hands; but there is an equally polite equilibrium where no one shakes hands. The only bad result is when some people offer
to shake hands, and others refuse. How
you would modify this simple model to account for the rise of swine flu – a
disease that might be spread by hand-shaking?
Is it possible for this disease to change the number of equilibria in
the game? Explain using both words and a
Personally, I think now’s a great time to switch to bowing. Can economists lead the way?