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Behavioral Theory of Repeated Prisoner’s Dilemma: Generous Tit-For-Tat Strategy

Author

Listed:
  • Matsushima Hitoshi

    (Department of Economics, University of Tokyo, 7-3-1 Hongo, Bunkyo-ku, Tokyo 113-0033, Japan)

Abstract

This study investigates infinitely repeated games of a prisoner’s dilemma with additive separability in which the monitoring technology is imperfect and private. Behavioral incentives indicate that a player is not only motivated by pure self-interest but also by social preference such as reciprocity, and that a player often becomes naïve and selects an action randomly due to her cognitive limitation and uncertain psychological mood as well as the strategic complexity caused by monitoring imperfection and private observation. By focusing on generous tit-for-tat strategies, we characterize a behavioral version of Nash equilibrium termed behavioral equilibrium in an accuracy-contingent manner. By eliminating the gap between theory and evidence, we show that not pure self-interest but reciprocity plays a substantial role in motivating a player to make decisions in a sophisticated manner.

Suggested Citation

  • Matsushima Hitoshi, 2020. "Behavioral Theory of Repeated Prisoner’s Dilemma: Generous Tit-For-Tat Strategy," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 20(1), pages 1-11, January.
    • Handle: RePEc:bpj:bejtec:v:20:y:2020:i:1:p:11:n:1
    DOI: 10.1515/bejte-2019-0030
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    Cited by:

    1. Kayaba, Yutaka & Matsushima, Hitoshi & Toyama, Tomohisa, 2020. "Accuracy and retaliation in repeated games with imperfect private monitoring: Experiments," Games and Economic Behavior, Elsevier, vol. 120(C), pages 193-208.
    2. Yao, Zhouzhou & Wu, Xianyu & Yang, Yang & Li, Ning, 2024. "A digital decision approach for indirect-reciprocity based cooperative lane-changing," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 633(C).
    3. Hitoshi Matsushima, 2023. "Preventing Global Catastrophes," CARF F-Series CARF-F-573, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.
    4. Yutaka Kayaba & Hitoshi Matsushima & Tomohisa Toyama, 2019. "Accuracy and Retaliation in Repeated Games with Imperfect Private Monitoring: Experiments (Revised version of CARF-F-433)," CARF F-Series CARF-F-466, Center for Advanced Research in Finance, Faculty of Economics, The University of Tokyo.

    More about this item

    Keywords

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    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles

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