In game theory, what factor most directly explains the less favorable outcomes in a prisoner dilemma scenario despite the availability of a better option?

In the context of game theory, particularly the prisoner's dilemma, distrust plays a critical role in leading to less favorable outcomes, despite the existence of a mutually beneficial option. The prisoner's dilemma illustrates a situation where two individuals can either cooperate for a better collective outcome or betray one another for potentially individual gain.

When participants in this scenario harbor distrust towards each other, they are likely to defect rather than cooperate, fearing that the other will betray them. This lack of trust undermines the possibility of achieving the optimal, cooperative outcome that would benefit both parties. Each player's decision is heavily influenced by their expectations of the other's actions, and without a level of trust, the rational choice becomes defection—resulting in a suboptimal equilibrium.

The other factors listed, such as overconfidence, strategic choice, or insufficient information, may also affect decision-making but do not capture the essence of why distrust directly leads to poorer outcomes in this specific scenario. They might contribute to individual behaviors but don't fundamentally account for the dynamic of mutual trust that is crucial to cooperation in the prisoner's dilemma. Distrust is the primary barrier that prevents participants from recognizing and opting for the better cooperative outcome.