To clarify something which was badly written, the narrow subset of game theory normally applied to human interaction assumes rough parity of intelligence in the general abstract sense. You can have any odd mixture of good people and bad people, but the game theory will always work out the same if all the parties involved have roughly equivalent intelligence. Having lots of "bad" people or lots of "good" people in a population does not change the outcomes of the basic theory, which is also why cultural indoctrination and behaviors tend to have only a mild impact on game theoretic outcomes around the world at large. The aggregate nature of the behaviors of a population don't change the basic game theory that one applies to determine the optimality and outcomes of said behaviors.
Where things become very interesting is when you leave the narrow case of parity with respect to intelligence of the agents in a system. Our justice system is premised on this parity, but one can show that if there is sufficient disparity (e.g. if you have a brilliant criminal and stupid police/prosecutors or vice versa) then the likely game theoretic outcome will NOT be "justice" in the sense you would expect if there was parity. Parity of intelligence is a useful fiction, but sometimes you can see where it strains the system as expectations meet theoretical reality. Game theory as applied to strong asymmetries of intelligence represents a real conundrum, particularly as it applies to social and cultural institutions.
My study of asymmetric systems has given me a much better idea of just how fragile and unreconcilable many of our institutions are in a larger sense, and changed my views on some issues. It would take a relatively small asymmetry to affect radical changes in the basic nature of the systems, and with the progress of technology, such asymmetries are feasible within our lifetimes. Our social and cultural institutions as we know them literally cannot exist in an environment where such asymmetries exist; they are not stable constructs outside narrow game theoretic premises that just happen to be the rule for now as practical matter.
What is the disadvantage of having overly intelligent police/prosecuters. Simply the opportunity for successful corruption or something more subtle?
Can you suggest a text on this subject? Its fascinating.