Cooperation in a one-shot Prisoners' Dilemma
AbstractIn this paper, we model social interactions which are characteristic of large economies. The key properties of this model are: (1) agents are randomly matched over time to engage in a Prisoners' Dilemma; (2) each agent routinely interacts with a proper subset of the other agents; and (3) each agent has highly imperfect information about the past conduct of other agents. For this setting, we show the optimality of a rule of thumb which does not discriminate between encounters with agents that one regularly meets and encounters with agents that one never expects to meet again. This rule of thumb generates cooperative behavior in all encounters. Journal of Economic Literature Classification Numbers: C72, D74.
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Bibliographic InfoArticle provided by Elsevier in its journal Games and Economic Behavior.
Volume (Year): 8 (1995)
Issue (Month): 2 ()
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Web page: http://www.elsevier.com/locate/inca/622836
Find related papers by JEL classification:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances
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