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How Moral Codes Evolve in a Trust Game

Author

Listed:
  • Jean Paul Rabanal

    (Economics Department, Ball State University, 2000 W. University Ave. Muncie, IN 47306, USA)

  • Daniel Friedman

    (Department of Economics, University of California Santa Cruz, 1156 High Street, Santa Cruz, CA 95064, USA)

Abstract

This paper analyzes the dynamic stability of moral codes in a two population trust game. Guided by a moral code, members of one population, the Trustors, are willing to punish members of the other population, the Trustees, who defect. Under replicator dynamics, adherence to the moral code has unstable oscillations around an interior Nash Equilibrium (NE), but under smoothed best response dynamics we obtain convergence to Quantal Response Equilibrium (QRE).

Suggested Citation

  • Jean Paul Rabanal & Daniel Friedman, 2015. "How Moral Codes Evolve in a Trust Game," Games, MDPI, vol. 6(2), pages 1-11, June.
    • Handle: RePEc:gam:jgames:v:6:y:2015:i:2:p:150-160:d:50656
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    References listed on IDEAS

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    Cited by:

    1. Berger, Ulrich, 2016. "Learning to trust, learning to be trustworthy," Department of Economics Working Paper Series 212, WU Vienna University of Economics and Business.
    2. Fulei Shi & Chuansheng Wang & Cuiyou Yao, 2022. "A New Evolutionary Game Analysis for Industrial Pollution Management Considering the Central Government’s Punishment," Dynamic Games and Applications, Springer, vol. 12(2), pages 677-688, June.

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