Laws and Rules

Laws and rules are also a means of solving a coordination issue. They force all participants to make a certain deterministic decision.

A rule could be on what side of the street cars have to drive or to stop at a red traffic light. However, laws and rules change the pay-offs for each player as they usually impose penalties on the case of defection. This means that someone can enforce those rules. With this assumption, we leave the field on non-cooperative game theory.