Analysis of the 2007-2008 Writer’s Guild Strike with Game Theory

Abstract

In 2007-2008, the writer’s guild of America went on strike in order to receive a better outcome from management. We built a game to analyze the situation. The Nash equilibrium of that game says that the writers should not strike and that management should maintain the status quo. The equilibrium is quite unattractive to the writers leading to a strike and forcing management to negotiate. We illustrate the results in order to gain insights into the process. We demonstrate finding the Nash equilibrium with both ordinal and then cardinal values. We demonstrate a method to find the cardinal values using the analytical hierarchy processes to measure the utility for the strategies. We show finding the prudential strategies and security levels as well as finding threat levels in this example. We show using the threat level in Nash arbitration leads to a better solution for the writers than using the security levels.