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Using the concept of game theory and the prisoner's dilemma, explain why it is better for...

Using the concept of game theory and the prisoner's dilemma, explain why it is better for oligopoly firms to work together than compete with each other. How can they achieve this outcome?

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Consider the following example of a prisoner's dilemma of two oligopoly firms Here, the best possible outcome is (3,3) but when the game theory is solved assuming that the two firms doesnt know each other's strategies, the outcome would be (2,2) which is not feasible. Therefore, it they workworked together, they wouwould have earned more. That is the reason why oligopoly firms should work together.

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