Focal Point (game Theory)

Focal Point (game Theory)

In game theory, a focal point (also called Schelling point) is a solution that people will tend to use in the absence of communication, because it seems natural, special or relevant to them. The concept was introduced by the Nobel Prize winning American economist Thomas Schelling in his book The Strategy of Conflict (1960). In this book (at p. 57), Schelling describes "focal point for each person’s expectation of what the other expects him to expect to be expected to do." This type of focal point later was named after Schelling.