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Cooperation among behaviorally heterogeneous players in social dilemma with stay of leave decisions

Author

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  • Xiaochuan Huang

    (DT Capital Management Co., Ltd.)

  • Takehito Masuda

    (Institute of Economic Research, Kyoto University)

  • Yoshitaka Okano

    (School of Economics and Management, Kochi University of Technology)

  • Tatsuyoshi Saijo

    (School of Economics and Management, Kochi University of Technology)

Abstract

We experimentally test a two-stage mechanism called the stay-leave mechanism to achieve cooperation in n-plyer prisoner's dilemma situations. Under this mechanism, each cooperator has the chance to revise his choice when players' choices are not unanimous. We say a player is selfish if he eliminates dominated choices in each stage. If all participants of the stay-leave mechanism are selfish, for any value of public good benefit that arises, the unique equilibrium is unanimous cooperation. The average cooperation rate in the stay-leave mechanism experiment averaged 86.6% across 15 periods, with an upward trend, increasing to 96.0% after period 5. By examining earlier period data, we detected that selfish and conditionally cooperative subjects coexist at a proportion of approximately 3:1. Finally, we extended our model to incorporate a mixture of the observed two types and misbeliefs about others' types. Paradoxically, unanimous cooperation is less likely to occur as the number of conditionally cooperative players increase. The model also partially explains the observed upward trend in the cooperation rate in the stay-leave mechanism sessions.

Suggested Citation

  • Xiaochuan Huang & Takehito Masuda & Yoshitaka Okano & Tatsuyoshi Saijo, 2016. "Cooperation among behaviorally heterogeneous players in social dilemma with stay of leave decisions," KIER Working Papers 944, Kyoto University, Institute of Economic Research.
    • Handle: RePEc:kyo:wpaper:944
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    Cited by:

    1. Tatsuyoshi Saijo & Takehito Masuda & Takafumi Yamakawa, 2018. "Approval mechanism to solve prisoner’s dilemma: comparison with Varian’s compensation mechanism," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 51(1), pages 65-77, June.
    2. Tatsuyoshi Saijo & Takehito Masuda & Takafumi Yamakawa, "undated". "Approval Mechanism to Solve Prisoner’s Dilemma: Comparison with Varian’s Compensation Mechanism," Working Papers SDES-2016-15, Kochi University of Technology, School of Economics and Management.
    3. Saijo, Tatsuyoshi & Shen, Junyi, 2018. "Mate choice mechanism for solving a quasi-dilemma," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 72(C), pages 1-8.
    4. Tatsuyoshi Saijo, 2019. "Second thoughts of social dilemma in mechanism design," Working Papers SDES-2019-6, Kochi University of Technology, School of Economics and Management, revised Jun 2019.

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    More about this item

    Keywords

    social dilemma; experiment; conditional cooperator; behavioral heterogeneity;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • P43 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Finance; Public Finance

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