The Snowdrift Dilemma

The name Snowdrift.coop refers to the Snowdrift Dilemma, a metaphor from game theory (the study of strategic decision making).

Such games generally assume all participants to be self-interested rational actors, and we know you aren’t like that, but the model remains insightful despite its limitations. For a great interactive intro to this type of game theory, check out Nicky Case’s Evolution of Trust.

The snowdrift dilemma in particular is relevant to the issues of freeriding and public goods.

A snowdrift blocks the road

In a small neighborhood after a winter storm, a big snowdrift blocks the road. It’s too much for one person to easily clear. Everyone has other things to do.

Will you help clear it?

If you go out to shovel right away, you risk doing all or most of the work on your own. If you knew others would help, you might be up for cooperating. But you’d be happy if others just cleared the road without you.

Who gets started first?

The rational strategy for the snowdrift dilemma is to wait and see what others choose before you decide whether to help. But if everyone does that, we all just wait for everyone else.1

Sometimes, someone who can’t wait any longer ends up shoveling alone. The snowdrift may get partly cleared, but the one person took an unfair amount of the burden at great personal cost. If only we could all trust each other to cooperate right away, the work would get done sooner and in a more efficient and fair way.

Iteration changes our strategies

When a dilemma like this is a one-time case, we have no basis to trust others or care about building trust. But if we know we’ll see the same situation again, we have an incentive to build trusting relationships. So, intractable dilemmas become more solvable if we make them ongoing.

Voluntary contributions dilemma

Fundraising for public goods brings up a snowdrift-type dilemma. Everyone gets the results whether or not they contribute. So, a self-interested player will tend to freeride. Projects with tons of potential supporters can fail simply because everyone hesitates to accept the personal risk of contributing. Projects getting by with a few self-sacrificing supporters will struggle to reach their potential.

Crowdfunding campaigns partly address these dilemmas

Standard crowdfunding platforms like Kickstarter address these dilemmas by having donors pledge their support on the condition that everyone together reaches a preset fundraising goal. This threshold assurance is a major factor in the successful crowdfunding boom. However, there are several problems with threshold campaigns that make them an unsustainable and inadequte solution.

Snowdrift.coop solves the dilemma with ongoing crowdmatching

Unlike one-time crowdfunding campaigns, the Snowdrift.coop crowdmatching pledge provides both mutual assurance and sustained, ongoing support. This approach reduces everyone’s risk and maximizes the benefits achieved by choosing to donate instead of freeride.

Addressing social psychology

Real people are more complex than the rational self-interest model of classical economic game theories. We have complex social motivations like honor, altruism, guilt, and revenge.

Beyond the basic crowdmatching pledge, Snowdrift.coop also addresses social psychological factors to build a resilient community of public goods supporters.

  1. The snowdrift dilemma is often discussed in contrast to the better-known Prisoner’s Dilemma. By comparison, the Prisoner’s Dilemma is more intractable. Whereas the Snowdrift Dilemma leads to waiting to see what others decide, the Prisoner’s Dilemma makes defecting (i.e. not cooperating) always the self-interested rational choice for one-time, non-iterated games.

    For those unfamiliar with the original Prisoner’s Dilemma:

    Two prisoners have been charged with a crime. They are separated and each asked to confess. If both confess, they will both be convicted. If they both claim innocence, they will face a lighter charge. If one confesses and the other refuses, the one who confessed will go free; and their testimony will be used to convict the other prisoner — who will then get an extra harsh sentence for refusing to talk.

    So, as a player in this game:

    • If the other prisoner stays silent, you can confess and go free.
    • If the other prisoner confesses, you had better confess as well — otherwise you’ll get an extra harsh sentence.

    It doesn’t matter what the other player chooses! You should confess regardless. You know what to do without waiting for the other to decide. So, two rational prisoners will both confess in this game. Yet they would both be better off if they had both stayed silent!

    Although cooperation would be best, the prisoner’s dilemma inherently makes cooperation fail. Only though iterated rounds do we have the selfish incentive to cooperate so that we build trust.

    The Snowdrift Dilemma is more likely to lead to cooperation some of the time in even single rounds. Thankfully, many real-life situations are more like the snowdrift dilemma than the prisoner’s dilemma, but the details vary from case to case. A public goods project that runs a risk of failure due to insufficient resources works out more like a prisoner’s dilemma. With no guarantee of help from others, any one person risks totally wasting their contributions (whether as a developer donating time and effort or as a patron donating funds). By contrast, a struggling project that just needs help to prosper is more like a snowdrift dilemma.

    For some academic research on the difference, see this article at phys.org which summarizes a study titled “Human cooperation in social dilemmas: comparing the Snowdrift game with the Prisoner’s Dilemma”.