Final answer:
In a prisoner's dilemma, individuals benefit more from cooperation, which maximizes their collective gains (option a). This concept is found in the study of oligopoly and game theory, where cooperation can lead to better outcomes for all parties involved.
Step-by-step explanation:
Within the context of a prisoner's dilemma, each individual benefits more from cooperation than from pursuing self-interest, as it maximizes their gains. This scenario is particularly relevant in the analysis of oligopoly within game theory. In the classic prisoner's dilemma narrative, two co-conspirators are arrested but refuse to say anything to the police. They face the choice of either cooperating with each other by remaining silent or betraying the other by confessing.
The dilemma arises because if both prisoners cooperate by staying silent, they receive a moderate sentence. However, if one betrays the other while the other remains silent, the betrayer goes free and the silent prisoner receives a heavy sentence. Conversely, if both decide to betray, they both end up with a heavy sentence. Thus, while cooperation results in a better collective outcome (moderate sentence for both), individual rationality leads them to betray the other to minimize their own sentence (self-interest), often ending in a worse collective outcome (heavy sentences for both).