Lygon Street is considered the restaurant mecca of Melbourne. Tourists and locals flock there for the mix and quality of cuisine that is available. There is, however, one thing that visitors to Lygon...

Lygon Street is considered the restaurant mecca of Melbourne. Tourists and locals flock there for the mix and quality of cuisine that is available. There is, however, one thing that visitors to Lygon Street don’t like: spruikers, those pesky salespeople who stand outside a restaurant trying to lure customers. An article in The Age (Quinn 2010) described how, responding to public discontent about spruiking, the owners of eight restaurants on Lygon Street had met and agreed to ban spruiking. But the agreement did not last long. The article describes how only the day after the agreement had been made, one of the restaurants, Sale e Pepe, had put a spruiker back on the street. Suppose that there are two restaurants in Lygon Street. On each day they operate, they must each make a choice between ‘Spruik’ and ‘Not spruik’. Neither restaurant observes the choice made by the other restaurant prior to making its own choice. a Draw a game table showing this game, including pay-offs, so that it is a strict dominant strategy for each restaurant to choose ‘Spruik’. b Could this game be described as an example of a prisoners’ dilemma?



May 26, 2022
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