Let's Make a Deal

Economic models normally assume perfectly rational actors operating with perfect information about prices, supply and the goods and services involved in a decision. Even simple supply and demand models based on these assumptions are usually grossly inaccurate. Game theory is a field within economics that attempts to improve predictive results by factoring in the impact of actors operating with imperfect information or asymmetric access to information. The assumption behind game theory analysis is that INCLUDING intangible / unquantifiable factors into a model is more accurate than assuming they are zero and excluding them from the analysis.

The classic example of game theory is the Prisoner’s Dilemma problem in which

  • two parties A and B are jailed for suspicion of a crime
  • the sheriff has no actual evidence on either suspect but believes both are guilty
  • A and B are jailed in separate cells and unable to communicate with one another
  • A and B are each offered a deal – say nothing (serve less time on a lesser charge) or rat on the other (they serve a much longer term, you go free)

The best collective decision for both would be to say nothing and both only serve a minor term. However, individually each has the incentive to attempt to go free by ratting out the other hoping the other opts for the best collective path. However, when both make that same individually optimal decision, BOTH wind up serving a longer term. Even with a perfect understanding of the rules of the “game”, the asymmetry of information (what is the other guy actually doing?) and the distorted incentives yield a sub-optimal result for the two.

The “coup attempt” in Russia on June 24, 2023 is the consequence of a Prisoner’s Dilemma game on steroids with worldwide repercussions that is still being played. This game involves not only asymmetric information and incentives, but actors who are all acting upon distorted inputs and are morally and ethically irrational.

Key Players in the Game

Normally, it would be obvious to assume Vladmir Putin is the “sheriff” of this Prisoner’s Dilemma game. One would assume he is the one dictating the rules of the game and therefore controls both the incentives facing the players and the information they use in their decisions. In reality, Putin is only one of the prisoners in the game. He is equally trapped by the distorted information created by the authoritarian regime he operates. He cannot trust information about the location and capability of his military any more than any of his potential rivals. The sheriff in the game is the entire authoritarian system, which distorts the inputs and warps the motives of everyone acting in the system to everyone’s detriment.

Yevgeny Prigozhin is obviously a key player in the game. He has a long personal and economic history with Putin and, until 2023, appeared to enjoy a protected position in the Putin regime doing Putin’s dirty work under lucrative contracts that enriched him personally.

Sergei Shoigu is a player in the game, serving as a proxy for the entire Russian Ministry of Defense. Like most authoritarians, Putin’s primary strategy for maintaining control is to divide key areas of responsibility between competing (if not outright warring) factions. This approach attempts to ensure no single entity gains complete control over a key function and that Putin must routine act as tie-breaker for any decision, thus assuring information has to be shared with him and that all parties see that he is still the final arbiter. Shoigu nominally heads the Ministry of Defense but Putin purposely diluted his power by allowing the Wagner Group to exist and by tasking it with some of the most critical Russian initiatives in the last decade (invasion of the Donbas region of Ukraine in 2014, operations in Syria to support Assad in 2016, now Ukraine proper).

Alexsandr Lukashenko might be appropriate to include as a player in this game as well. He leads Belarus which neighbors Ukraine to the north but has been in poor health for years, prompting repeated death watch stories in the media every few months. Belarus is crucial to Putin for multiple possible outcomes. Currently, Belarus has demonstrated zero ability to assist Russia with physical supplies or manpower in the war. Belarus has agreed to allow “tactical” nuclear weapons to be staged in the country but it isn’t clear where this threat lies on the “sabre rattling” to “deadly threat” scale. The key advantage posed by a pliant Belarus is a clear supply line from Russia to the northern part of Ukraine that doesn’t depend upon vulnerable bridges in the Crimean and eastern regions of Ukraine that are already damaged or at risk. Additionally, if supply chains can be established through Belarus, the fighting power delivered would be much closer to Kyev from that direction than if coming in from the east. However, use of Belarus as an alternate staging location is not currently a certainty, not only because of Lukashenko’s poor health but because of his unpopularity within the country. If Lukashenko dies or loses power, it is not clear a successor would be as closely aligned with Putin unless the successor is hand picked and imposed by Putin.

Overarching Themes

No one has seen the text of any agreement between any of the actors in this game. There likely is no physical agreement (regardless of how it is summarized in the media) and even if a physical agreement exists, its written words mean nothing.

The appearance of loyalties are a factor in behavior but ACTUAL loyalties do not exist in an authoritarian government driven by brutality and fear. “Loyalties” will flip to the actor in closest proximity presenting the greatest immediate threat to one’s survival. This holds not only for underlings losing favor with those above. It holds for those at the top when enough underlings devise ways to turn the tables and escape prior constraints.

While Wagner forces have been characterized as “elite” and highly lethal teams, they are NOT part of the official Russian military (that’s the whole point of them being “off the books”). That means they do NOT control more sophisticated weaponry and they likely do NOT have access to more advanced intelligence and communications gear in the field. That means their internal communications are likely readily available for intercept by Putin (and to American intelligence, which is why American intelligence teams had word of these “events” in early June). Prigozhin likely understands the consequences of this and knows he enjoys zero confidentiality in any of his communications that would be required to coordinate a coup.

Both Putin and Prigozhin face prosecution for war crimes if they lose power or step foot in a western-aligned country. For each, their end-game strategies start with avoiding assassination by internal competing factions but even ignoring that, both must consider scenarios for living outside the construct of the existing Putin regime. In some sense, Prigozhin is better positioned than Putin for that eventuality. Wagner Group has deals with numerous regimes in Africa for providing training and ongoing protection services for dictators in those regimes. There are likely ten places Prigozhin could fly to in 24 hours to escape a meltdown in Russia and still have some possibility of escaping war crime prosecution.

Coup or Not?

Given all the (dis)information and incentives that can be observed, it seems unlikely the events of June 24, 2023 constituted a legitimate coup attempt, for these reasons:

  • Prigozhin knows he had no ability to communicate coup plans without interception by Russian intelligence
  • Prigozhin lacked the weaponry required to fend off attacks from jets that would occur upon nearing Moscow
  • Prigozhin likely recognized that the loyalty and morale demonstrated by grunts in Rostov who faced the possibility of being sent to the front had zero correlation to the loyalty and morale of personnel controlling defenses of Moscow – they WOULD likely follow orders and wipe him out from above in seconds
  • Media reports on the “attack” by Russian forces on Wagner troops that supposedly prompted Prigozhin’s coup indicate that in hindsight, the attacks look as staged as the “bombing” of the dome in Moscow a few weeks back

So if the events of June 24 weren’t a coup, what were they? What did they accomplish, if anything?

Likely Outcomes

Regardless of whether Prigozhin’s feint towards Moscow was real or not, the actual events in Rostov made it clear to Putin that an overwhelming share of defense ministry personnel and grunts in that region demonstrated ZERO loyalty to Putin. Wagner forces rolled into the city without a shot being fired. For an authoritarian ruling via fear, this information DEMANDS action. It confirms to the public what is likely unspoken but widely known but cannot be exposed openly. The defense leaders in that region can expect to die shortly. If there is an actual training facility or barracks for troops stationed in Rostov, it would seem certain that facility will be bombed by Russia in the coming weeks. The only mystery will be if Putin attempts to blame it on Ukraine or takes credit for it to send a message to other Russian forces to reimpose discipline through fear. Either way, it will be clear Putin directed it to happen.

Regardless of Putin’s eventual goal for the war in Ukraine, Prigozhin is likely being relocated to Belarus to stage him as Lukashenko’s replacement. In the short term, relocating Prigozhin to Belarus places him closer to Kyev to suit current war goals. Regardless of how the war goes, Putin wants to ensure Belarus stays aligned with Russia in the future and if Lukashenko dies or is tossed out through unrest, it is less clear to Putin if any other leader will take his place that will be as compliant as Prigozhin. Prigozhin has an incentive to stay in Belarus in the short term because he knows that remaining in a clear satellite country of Russia makes it less likely international forces will attempt to capture him for prosecution of war crimes. Prigozhin technically might not need an offer of “exile” in Belarus from Putin to protect himself. He has relationships with multiple states in Africa that could likely serve as refuges – both from war crimes prosecution and assassination attempts by Putin if he thought that was a possibility. If Prigozhin stays in Belarus for any period of time, it would be a clear indication he is still allied with Putin.

If Prigozhin is being staged as a successor to Lukashenko, then what did Lukashenko get out of all of this? Probably nothing more than a few more months in power with an explicit vote of support from Putin Lukashenko can use internally to quell unrest while he waits for a final exit. If Russia does attempt to shift staging operations out of eastern Ukraine into Belarus, it is not clear how popular such an action would be domestically within Belarus. Additional unrest could topple Lukashenko, making his end of days much less comfortable than merely waiting it out and dying in place.

It is less clear what impact the “agreement” has upon the Russian military at the ground level or in the Ministry of Defense. Deaths on the ground in Ukraine have already churned through a surprising number of commanders, including 5-14 generals depending on whether you trust Russian figures or Ukrainian figures. Putin has shuffled leaders further up the chain several times with little improvement in outcomes on the battlefield. At this point, folding Wagner forces back under the control of the Russian military does not alter the calculus of the war. Wagner entered Ukraine with nearly 50,000 troops, recruited roughly 20,000 from Russian prisons between summer 2022 and February 2023 and began its action in Rostov with approximately 25,000 troops. That’s a net loss of 45,000 men in sixteen months of fighting. Both Prigozhin and Putin have likely realized the mercenary strategy cannot scale to overcome Ukrainian strength and Russian incompetence.

It is crucial for western-aligned countries to understand that any shuffling of power within the Ministry of Defense that topples Sergie Shoigu from power does not mean Putin and the Russian military have recognized their folly in invading Ukraine and will begin tacking to negotiating an exit. Prigozhin’s primary complaint has never been that the war shouldn’t have been launched or it cannot be won, only that incompetent, corrupt military bureaucrats were causing unnecessary losses of men who should have been able to fulfill the mission. Prigozhin is no dove. He would focus MORE lethality on Ukraine. Putin is already so close to losing control of his empire, he may very well conclude the odds are higher for him remaining in power by continuing to fight in Ukraine than exiting and needing to keep the oligarchs beneath him in line to retain power.




You make an interesting, informed, and useful speculative analysis. I do not buy it, but then I do not buy any of the wildly varied analyses I see on offer.

Watching closely.

David fb


How did you decide which ‘game’ to use in your analysis?


The more general concepts of “game” theory come into play any time a group of actors are attempting to make decisions with an assumed understanding of a set of rules limiting their choices. Originally, game theory focused on trying to explain how a situation in which INDIVIDUALS with a rational understanding of the rules and their own best interest could consistently make INDIVIDUAL decisions that produced the worst COLLECTIVE outcome.

For Russia, the “prisoner’s dilemma” example is particularly apt because the scenario involves actors who are trying to ESCAPE consequences of prior actions and must make decisions with imperfect information about the OTHER actor’s decisions that affect theirs. In Russia’s case, the dynamics are even more convoluted because decades of corruption and inefficiency mean each actor cannot even trust information it thinks it has about his OWN capabilities, much less the capabilities and intents of his competitors. The result of this game scenario is virtually unpredictable with any specifics, only that the collective outcome is guaranteed to be sub-optimal not only for those trapped in the game, but the rest of the world watching in horror as it plays out.



Horror combined with a certain amount of amusement.

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I’m not watching in horror. Schadenfreude would be more like it. I may revise my opinion if nuclear war breaks out.


@Goofyhoofy I’m not watching in horror. Schadenfreude would be more like it. I may revise my opinion if nuclear war breaks out.

I would like to view this as a case of scorpions trapped in a bottle where I could just root for all of them to kill each other off. I’d like to think that all of the prisoners enlisted by Wagner to march directly to their immediate death were the dregs of an already horrible society that somehow “deserved” to be served up like cannon fodder. In an authoritarian regime, many of those in prison MIGHT have been murderers and rapists but many were also in jail as part of persecution and corruption.

In this case, the actors have already shown they are willing to commit “ecocide” by blowing dams and they have repeatedly threatened damage to a vast nuclear power plant complex in a country where Russian incompetence already created a nuclear no-man’s land that will threaten life for thousands of years. And they have a nuclear weapon stockpile that must remain secure despite their military command and control being in chaos.

The reality is it is impossible to release this kind of violence and turmoil upon tens of millions of Ukrainians then tens / hundreds millions more in the rest of the countries that will likely experience turmoil amid a collapse of the current Putin regime without generating more cycles of violence and repression that will ripple across generations.

The tragedy here is this is an inherent outcome of authoritarian regimes. They are equally effective at sowing the seeds of their destruction AND their resurrection. You can practically set your watch to it on a 30 year cycle.