Analysis of the "Prisoner's Dilemma" Model in the Application of Price-Matching Dilemma: Taking MeiTuan and Everything 30min as Example

Abstract

One of the most well-known examples of game theory and a significant element of economic theory is The Prisoner's Dilemma. The Prisoner's Dilemma is one of the best instances of the conventional non-zero-sum game in game theory, which demonstrates that the group does not always represent the best option for individuals. When major brands and companies are engaged in competition, the Prisoner's Dilemma model is used to examine strategic choices and price setting. Everything 30min and MeiTuan, the two major participants in the takeaway market, would be excellent instances for using the Prisoner's Dilemma model. This paper analyzed the two companies in a similar prisoner's dilemma in the price war, how MeiTuan is a newcomer to the industry is how to break the everything 30min monopoly and enter the market with its share of the market. Finally, this paper integrated the dynamics of the price-matching war between the two big competitors with the prisoner's dilemma to come up with three suggestions. Additionally, these three suggestions can further help them out of the prisoner's dilemma like the price-matching war.