Introduction

To make the transition from the prevalent Nash Equilibrium with its lower payoffs to Pareto-optimal which will yield higher pay offs, India and Pakistan must break away from their traditional thinking of making no concessions.

By postulating that the players think ahead not just to their immediate consequences, but also to the others, game theory can provide a framework to think about defending against terrorist attacks.

India has to not only fight over-consumption of resources in metropolitan cities but also make sure that the resources saved percolate down to its rural areas.