How is prisoner's dilemma different from chicken? Chicken is a famous game where two people drive on a collision course straight towards each other. Whoever swerves is considered a 'chicken' and loses, but if nobody swerves, they will both crash. So the payoff matrix looks something like this:
                  B swerves               B straight
A swerves            tie               A loses, B wins
A straight     B loses, A wins            both lose 

But I have heard of another situation called the prisoner's dilemma, where two prisoners are each given the choice to testify against the other, or remain silent. The payoff matrix for prisoner's dilemma also looks like  
                  B silent               B testify
A silent            tie               A loses, B wins
A testify     B loses, A wins            both lose 

I remember hearing that in the prisoner's dilemma, it was always best for both prisoners to testify. But that makes no sense if you try to apply it to chicken: both drivers would crash every time, and in real life, almost always someone ends up swerving. What's the difference between the two situations?

(See http://en.wikipedia.org/wiki/Chicken_%28game%29#Prisoner.27s_dilemma.)
The difference is in the payoff. In the "chicken" game, the payoff matrix is like
        Sw       St
   Sw  0,  0   -1, +1
   St +1, -1  -10, -10

While in the PD game: 
        Si       Te
   Si  3, 3     0, 5
   Te  5, 0     1, 1

Both games have this structure in the payoff table:
         C       D
   C   R, R     S, T
   D   T, S     P, P

But:


*

*In PD game, the order is T > R > P > S

*In Chicken game, the order is T > R > S > P


This leads a different Nash equilibria. In the PD game, if A remains silent, B chooses to testify because T > R, while if A testifies, B should also testify because P > S. So testifying is B's most rational choice after considering all possibilities.
But in the Chicken game, as S > P, if A goes straight, B should swerve. This leads to two Nash equilibria in the pure game: (St, Sw) and (Sw, St). 
