That's a pretty unsophisticated look at the game. It's very possible to win a game of diplomacy without ever lying once. This is especially true if you play with the same people a few times: When people get to choose between being allied with a known backstabber or with someone that will tell the truth, guess what? The backstabber loses. After a big backstab, chances are you are getting clobbered in the next game, because on the first couple of turn, chances are you'll have trouble being part of an early alliance, and thus end up as food, especially if you are stuck playing Italy.
It's far more valuable to know who else is lying, and trying to gain information from other people on the table. So much of the game comes from figuring out what other people will do. Being persuasive is also very important, and it's very hard to be persuasive when people know you are a good liar.
Of course you don't have to lie to win at Diplomacy, but even in an iterated game scenario, I believe that never lying is a suboptimal strategy. As the article notes, players who do this are derisively called "care bears" and in my experience, aren't the most successful, though they may come in second fairly often (speaking from experience as something of a care bear myself.)
Over multiple repeated games with the same players, no doubt some sort of equilibrium arises where on the scale of 0 to 1, zero always being a care bear, and one always being cutthroat, an optimal strategy probably lies... well, I'd be curious to know exactly where that optimum lies, actually. Anyone care to guess? My guess would be somewhere around ~.25.
i disagree on some points. when playing these types of games with people you played many times with, its really about knowing WHEN and HOW to backstab.
playing a game where everyone is honest (especially in diplomacy where there is no random variation), you already know who is the winner from the onset. who would even want to play. diplomacy will always end in a tie if 'teams' are even and once you outnumber the enemy its over, unless someone doesnt keep their end. maybe I am remembering the game wrong
It's far more valuable to know who else is lying, and trying to gain information from other people on the table. So much of the game comes from figuring out what other people will do. Being persuasive is also very important, and it's very hard to be persuasive when people know you are a good liar.