Garry Kasparov may have dedicated his life to chess – but maths experts have now concluded that the game is simply impossible to fully master.
A physicist at Manchester University says games of skill such as poker, chess, and Go are too complex for the human mind to fully understand.
Dr Tobias Galla, from the university, ran thousands of simulations of two-player games to see how human behaviour affects decision-making.
When games became more complex and when there are a lot of moves, they found that players’ actions became less rational and it was harder to find the best strategies. Dr Galla said the findings could be transferred to explain problems with financial stock markets.
Many economists base financial predictions on the theory of ‘equilibrium’, assuming traders are intelligent and rational.
But Dr Galla, from the university’s School of Physics and Astronomy, said this was rarely the case and could lead to economic predictions being wildly inaccurate. Publishing his findings, he said: “Equilibrium is not always the right thing you should look for in a game.
“In many situations, people do not play equilibrium strategies, instead what they do can look random or chaotic for a variety of reasons, so it is not always appropriate to base predictions on the equilibrium model.
“With trading on the stock market, for example, you can have thousands of different stocks to choose from, and people do not always behave rationally in these situations or they do not have sufficient information to act rationally. This can have a profound effect on how the markets react.
“It could be that we need to drop these conventional game theories and instead use new approaches to predict how people might behave.”
The researchers are now looking to expand their study into multi-player games to see how they could give a better understanding of how financial markets operate.
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