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Community enforcement when players observe partners' past play

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  • Takahashi, Satoru

Abstract

I investigate whether a large community can sustain cooperation in the repeated prisoner's dilemma by having cheaters punished not by their victims but by third parties. In the setting where players can observe their partners' past play only, I show that cooperation can be sustained by an equilibrium that has the following two properties: players choose their actions independently of their own past play, and they are indifferent between cooperation and defection at all histories. This equilibrium carries over to the finite-population setting and is robust to noise in the process of choosing actions or of recording past play.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Theory.

Volume (Year): 145 (2010)
Issue (Month): 1 (January)
Pages: 42-62

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Handle: RePEc:eee:jetheo:v:145:y:2010:i:1:p:42-62

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Web page: http://www.elsevier.com/locate/inca/622869

Related research

Keywords: Repeated game Random matching Community enforcement Belief-free equilibrium First-order information;

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Cited by:
  1. Subhasish Dey & Katsushi S. Imai, 2014. "Workfare as "Collateral": The Case of the National Rural Employment Guarantee Scheme (NREGS) in India," The School of Economics Discussion Paper Series, Economics, The University of Manchester 1412, Economics, The University of Manchester.
  2. Michael McBride & Ryan Kendall & Martin B. Short & Maria R. D'Orsogna, 2012. "Crime, Punishment, and Evolution in an Adversarial Game," Working Papers 121308, University of California-Irvine, Department of Economics.
  3. Francesc Dilmé, 2012. "Cooperation in Large Societies," PIER Working Paper Archive 12-011, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
  4. Konrad Podczeck & Daniela Puzzello, 2012. "Independent random matching," Economic Theory, Springer, Springer, vol. 50(1), pages 1-29, May.
  5. Yuichi Yamamoto, 2012. "Individual Learning and Cooperation in Noisy Repeated Games," PIER Working Paper Archive 12-044, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
  6. Dai, Darong, 2012. "On the Existence of Pareto Optimal Endogenous Matching," MPRA Paper 43125, University Library of Munich, Germany.
  7. Nava, Francesco & Piccione, Michele, 2014. "Efficiency in repeated games with local interaction and uncertain local monitoring," Theoretical Economics, Econometric Society, Econometric Society, vol. 9(1), January.
  8. Wojciech Olszewski, 2007. "A Simple Exposition of Belief-Free Equilibria in Repeated Games," Economics Bulletin, AccessEcon, vol. 3(58), pages 1-16.
  9. Joyee Deb & Julio González Díaz & Jérôme Renault, 2013. "Uniform Folk Theorems in Repeated Anonymous Random Matching Games," Working Papers, New York University, Leonard N. Stern School of Business, Department of Economics 13-16, New York University, Leonard N. Stern School of Business, Department of Economics.
  10. Joyee Deb, 2008. "Cooperation and Community Responsibility: A Folk Theorem for Repeated Matching Games with Names," Working Papers, New York University, Leonard N. Stern School of Business, Department of Economics 08-24, New York University, Leonard N. Stern School of Business, Department of Economics.
  11. Berger, Ulrich, 2011. "Learning to cooperate via indirect reciprocity," Games and Economic Behavior, Elsevier, vol. 72(1), pages 30-37, May.
  12. Filip Vesely & Chun-Lei Yang, 2013. "On Optimal Social Convention in Voluntary Continuation Prisoner's Dilemma Games," CESifo Working Paper Series 4553, CESifo Group Munich.
  13. Yuichi Yamamoto, 2013. "Individual Learning and Cooperation in Noisy Repeated Games," PIER Working Paper Archive 13-038, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.

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