Forlytica Working Paper Series

Strategic Behavior in Drifting Environments:

A Phenomenological Reframing of Game Theory

Forlytica Research Group

Forlytica Working Paper No. 2025-01 · December 2025

A foundational conceptual paper describing strategic behavior as trajectory navigation within drifting informational terrain, with classical game theory recovered as a limiting case where drift and structure are artificially suppressed.

Executive Summary

Classical game theory offered one of the most elegant analytical frameworks of the 20th century. By formalizing strategic interaction through fixed payoff matrices, closed information structures, rational-choice postulates, and equilibrium concepts, it provided a precise language for understanding incentives in stylized environments. Yet its power came from the dimensions it excluded: drift, reputational dynamics, horizon effects, interpretive feedback, structural interdependencies, and the evolving nature of uncertainty.

This report restores those dimensions—not through new mathematics, but through a phenomenological reframing that describes the observable regularities of real strategic behavior. The central claim is simple: Strategic behavior is not optimization inside a static matrix; it is navigation through a drifting informational terrain.

Under this vantage, many of the field’s classical paradoxes dissolve. The Prisoner’s Dilemma no longer predicts inevitable defection once reputational spillovers, path dependence, and future interactions are acknowledged. Cooperation emerges as a stable attractor, not a fragile exception. Likewise, the classical explore–exploit dilemma of the multi-armed bandit collapses in environments where options share structure, information propagates across choices, and drift velocity—not uncertainty—is the dominant strategic constraint.

Across these reconstructions, a consistent pattern emerges: Real strategic environments contain structure, memory, and motion. Classical game theory models the world without them.

When the classical assumptions are restored—drift = 0, horizons short, meta-channels suppressed, attractors flattened, posteriors frozen, structure factorized—one recovers classical game theory exactly. The static equilibrium world becomes a limiting case of the broader, dynamic landscape that agents actually inhabit. This containment relationship is the conceptual anchor of the entire reframing: classical theory is not contradicted; it is contextualized.

This shift has far-reaching implications. It aligns naturally with domains in which drift and interpretive dynamics dominate: entrepreneurship, innovation theory, market formation, organizational strategy, technological disruption, and national security analysis.

In these fields, scholars and practitioners routinely observe patterns—cooperation stability, robust trajectories, structural learning—that classical models struggle to express.

The phenomenological reframing provides the missing vocabulary.

It describes what stabilizes, what dissipates, what compounds, and what drifts in real strategic contexts—without relying on any underlying computational or inferential machinery. As such, it opens a wide analytic frontier for future research: scholars can explore cooperative attractors, drift-sensitive equilibria, structural inference, reputational spillovers, and identity coherence using standard empirical and qualitative tools.

In short: This report offers a new frame for strategic analysis—one in which adaptation, interpretation, drift, and trajectory replace the static calculus of mid-century game theory. It provides a coherent explanation for phenomena long treated as paradoxes and situates classical game theory within a larger, more realistic conceptual architecture. The goal is not to discard classical theory, but to place it within the dynamic, drifting environments where real strategic behavior unfolds.

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Length: approximately 30 pages

© Forlytica, 2025. All rights reserved.
This document presents a phenomenological conceptual framework. No proprietary algorithms or internal computational methods are disclosed.

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Series: Forlytica Working Paper No. 2025-01

Forlytica Research Group (2025). Strategic Behavior in Drifting Environments:
A Phenomenological Reframing of Game Theory. Forlytica Working Paper No. 2025-01.

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Keywords

game theory, dynamic strategy, drift, phenomenological models, exploration/exploitation,
structural interdependence, cooperation stability, trajectory coherence, national security analysis, entrepreneurship theory, innovation dynamics.

How This Relates to Forlytica's Applied Work

This conceptual reframing underlies Forlytica’s applied decision-intelligence protocols across innovation, organizational strategy, institutional analysis, and national-security domains. The paper communicates the worldview without exposing internal engines, allowing academics and analysts to engage the theory while Forlytica’s proprietary models remain protected.