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Sustaining cooperation in trust games

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  • Rigdon, Mary
  • McCabe, Kevin
  • Smith, Vernon

Abstract

It is well-known in evolutionary game theory that population clustering in Prisoner's Dilemma games allows some cooperative strategies to invade populations of stable defecting strategies. We adapt this idea of population clustering to a two-person trust game. Without knowing it, players are typed based on their recent track record as to whether or not they are trusting (Players 1) and whether or not they are trustworthy (Players 2). They are then paired according to those types: trustors with trustworthy types, and similarly non-trustors with untrustworthy types. In the control comparisons, Players 1 are randomly repaired with Players 2 without regard to type. We ask: are there natural tendencies for people to cooperate more frequently in environments in which they experience more cooperation in comparison with controls?

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 2006.

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Date of creation: Aug 2001
Date of revision: 23 Apr 2006
Handle: RePEc:pra:mprapa:2006

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Keywords: exchange; trust; reciprocity; cooperation; clustering; bargaining; experimental economics;

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References

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  1. Ernst Fehr & Simon G�chter, 2000. "Fairness and Retaliation: The Economics of Reciprocity," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 159-181, Summer.
  2. Schmidt, David & Shupp, Robert & Walker, James & Ahn, T. K. & Ostrom, Elinor, 2001. "Dilemma games: game parameters and matching protocols," Journal of Economic Behavior & Organization, Elsevier, vol. 46(4), pages 357-377, December.
  3. Anna Gunnthorsdottir & Daniel Houser & Kevin McCabe & Holly Ameden, 2004. "Disposition, History and Contributions in Public Goods Experiments," Experimental 0401001, EconWPA.
  4. Thomas Wiseman & Okan Yilankaya, 1999. "Cooperation, Secret Handshakes, and Imitation in the Prisoners' Dilemma," Discussion Papers 1248, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  5. Jorgen W. Weibull, 1997. "Evolutionary Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262731215, December.
  6. Hoffman, Elizabeth & McCabe, Kevin & Smith, Vernon L, 1996. "Social Distance and Other-Regarding Behavior in Dictator Games," American Economic Review, American Economic Association, vol. 86(3), pages 653-60, June.
  7. Selten, Reinhard & Stoecker, Rolf, 1986. "End behavior in sequences of finite Prisoner's Dilemma supergames A learning theory approach," Journal of Economic Behavior & Organization, Elsevier, vol. 7(1), pages 47-70, March.
  8. McCabe, Kevin A. & Rassenti, Stephen J. & Smith, Vernon L., 1998. "Reciprocity, Trust, and Payoff Privacy in Extensive Form Bargaining," Games and Economic Behavior, Elsevier, vol. 24(1-2), pages 10-24, July.
  9. James Andreoni & John H Miller, 1997. "Rational Cooperation in the finitely repeated prisoner's dilemma: experimental evidence," Levine's Working Paper Archive 670, David K. Levine.
  10. Andreoni,J. & Varian,H., 1999. "Pre-play contracting in the prisoners' dilemma," Working papers 18, Wisconsin Madison - Social Systems.
  11. Hoffman Elizabeth & McCabe Kevin & Shachat Keith & Smith Vernon, 1994. "Preferences, Property Rights, and Anonymity in Bargaining Games," Games and Economic Behavior, Elsevier, vol. 7(3), pages 346-380, November.
  12. Charness, Gary, 2000. "Bargaining efficiency and screening: an experimental investigation," Journal of Economic Behavior & Organization, Elsevier, vol. 42(3), pages 285-304, July.
  13. Guth, Werner & Schmittberger, Rolf & Schwarze, Bernd, 1982. "An experimental analysis of ultimatum bargaining," Journal of Economic Behavior & Organization, Elsevier, vol. 3(4), pages 367-388, December.
  14. Ahn, T K, et al, 2001. " Cooperation in PD Games: Fear, Greed, and History of Play," Public Choice, Springer, vol. 106(1-2), pages 137-55, January.
  15. Berg Joyce & Dickhaut John & McCabe Kevin, 1995. "Trust, Reciprocity, and Social History," Games and Economic Behavior, Elsevier, vol. 10(1), pages 122-142, July.
  16. David Kreps & Paul Milgrom & John Roberts & Bob Wilson, 2010. "Rational Cooperation in the Finitely Repeated Prisoners' Dilemma," Levine's Working Paper Archive 239, David K. Levine.
  17. repec:wop:humbsf:2001-2 is not listed on IDEAS
  18. Miller, John H., 1996. "The coevolution of automata in the repeated Prisoner's Dilemma," Journal of Economic Behavior & Organization, Elsevier, vol. 29(1), pages 87-112, January.
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Citations

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Cited by:
  1. Grimm, Veronika & Mengel, Friederike, 2011. "Matching technology and the choice of punishment institutions in a prisoner's dilemma game," Journal of Economic Behavior & Organization, Elsevier, vol. 78(3), pages 333-348, May.
  2. Bart J. Wilson & Taylor Jaworski & Karl E. Schurter & Andrew Smyth, 2012. "The Ecological and Civil Mainsprings of Property: An Experimental Economic History of Whalers' Rules of Capture," Journal of Law, Economics and Organization, Oxford University Press, vol. 28(4), pages 617-656, October.
  3. Erik O. Kimbrough & Roman Sheremeta, 2010. "Make Him an Offer He Can’t Refuse: Avoiding Conflicts through Side Payments," Working Papers 10-23, Chapman University, Economic Science Institute.
  4. Brown, M. & Serra Garcia, M., 2010. "Relational Contracting Under the Threat of Expropriation – Experimental Evidence," Discussion Paper 2010-85, Tilburg University, Center for Economic Research.
  5. Engseld, Peter & Bergh, Andreas, 2005. "Choosing Opponents in Prisoners' Dilemma: An Evolutionary Analysis," Working Papers 2005:45, Lund University, Department of Economics.
  6. Rodet, Cortney Stephen, 2013. "Seniority, Information and Electoral Accountability," MPRA Paper 49863, University Library of Munich, Germany.
  7. Bergh, Andreas & Engseld, Peter, 2005. "The Problem of Cooperation and Reputation Based Choice," Working Papers 2005:27, Lund University, Department of Economics, revised 04 May 2006.
  8. Smith, Vernon L., 2010. "Theory and experiment: What are the questions?," Journal of Economic Behavior & Organization, Elsevier, vol. 73(1), pages 3-15, January.
  9. Taylor Jaworski & Bart J. Wilson, 2009. "Go West Young Man: Self-selection and Endogenous Property Rights," Working Papers 09-02, Chapman University, Economic Science Institute.
  10. Thomas A. Rietz & Roman M. Sheremeta & Timothy W. Shields & Vernon L. Smith, 2011. "Transparency, Efficiency and the Distribution of Economic Welfare in Pass-Through Investment Trust Games," Working Papers 11-03, Chapman University, Economic Science Institute.
  11. Ochea, Marius-Ionut, 2013. "Evolution of repeated prisoner's dilemma play under logit dynamics," Journal of Economic Dynamics and Control, Elsevier, vol. 37(12), pages 2483-2499.
  12. Paganelli, Maria Pia, 2011. "The same face of the two Smiths: Adam Smith and Vernon Smith," Journal of Economic Behavior & Organization, Elsevier, vol. 78(3), pages 246-255, May.
  13. Kimbrough, Erik & Sheremeta, Roman, 2013. "Side-Payments and the Costs of Conflict," MPRA Paper 46808, University Library of Munich, Germany.
  14. Stahl, Dale O. & Haruvy, Ernan, 2008. "Level-n bounded rationality in two-player two-stage games," Journal of Economic Behavior & Organization, Elsevier, vol. 65(1), pages 41-61, January.
  15. Kimbrough Erik O. & Vostroknutov Alexander, 2012. "Using Rules to Screen for Cooperative Types: Rule-Following and Restraint in Common Pool Resource Systems," Research Memorandum 055, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  16. Michał Krawczyk, 2013. "Delineating deception in experimental economics: Researchers' and subjects' views," Working Papers 2013-11, Faculty of Economic Sciences, University of Warsaw.
  17. Engseld, Peter & Bergh, Andreas, 2005. "Choosing Opponents in Games of Cooperation and Coordination," Working Papers 2005:1, Lund University, Department of Economics, revised 03 May 2005.

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