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Evolution of “Pay-It-Forward” in the Presence of the Temptation to Free-Ride

Author

Listed:
  • Satoshi Uchida

    (Research Center for Ethi-Culture Studies, RINRI Institute, Tokyo 102-8561, Japan
    High-Tech Research Center, Kokushikan University, Tokyo 154-8515, Japan)

  • Tatsuya Sasaki

    (Department of Community Development, Koriyama Women’s College, Fukushima 963-8503, Japan)

  • Hitoshi Yamamoto

    (Faculty of Business Administration, Rissho University, Tokyo 141-8602, Japan)

  • Isamu Okada

    (Department of Business Administration, Soka University, Tokyo 192-8577, Japan)

Abstract

“Paying it forward” is a behavior in which people help someone else because they were helped in the past. Although experimental evidence exists that indicates that real human beings often “pay-it-forward” even in the face of free-rider risks, the theoretical basis for the evolution of this behavior remains unclear. In this paper, we propose a game-theoretical model that explains how pay-it-forward behavior can evolve despite the temptation to free-ride. By assuming that human beings exhibit cognitive distortions, as predicted by prospect theory, and that free-riding is punished with a tiny probability, we demonstrate that pay-it-forward, alongside unconditional altruistic behavior, can evolve and effectively deter free-riding behavior.

Suggested Citation

  • Satoshi Uchida & Tatsuya Sasaki & Hitoshi Yamamoto & Isamu Okada, 2024. "Evolution of “Pay-It-Forward” in the Presence of the Temptation to Free-Ride," Games, MDPI, vol. 15(3), pages 1-15, April.
    • Handle: RePEc:gam:jgames:v:15:y:2024:i:3:p:16-:d:1382824
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