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The breakdown of cooperation in iterative real-time trust dilemmas

Author

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  • Ryan Murphy

    ()

  • Amnon Rapoport

    ()

  • James Parco

    ()

Abstract

We study a class of trust-based cooperation dilemmas that evolve in continuous time. Characteristic of these dilemmas is that as long as all n players continue to cooperate, their payoffs increase monotonically over time. Simultaneously, the temptation to defect increases too, as the first player to defect terminates the interaction and receives the present value of the payoff function whereas each of the other n−1 players only receives a proportion δ (0 > δ > 1) of the defecting player’s payoff. We introduce a novel experimental institution that we call the Real-Time Trust Game (RTTG) to examine this class of interactions. We then report the results from an iterated RTTG in which the values of n and δ are varied in a between-subjects design. In all conditions, cooperation breaks down in the population over iterations of the game. The rate of breakdown sharply increases as n increases and more slowly decreases as δ increases. Copyright Economic Science Association 2006

Suggested Citation

  • Ryan Murphy & Amnon Rapoport & James Parco, 2006. "The breakdown of cooperation in iterative real-time trust dilemmas," Experimental Economics, Springer;Economic Science Association, vol. 9(2), pages 147-166, June.
  • Handle: RePEc:kap:expeco:v:9:y:2006:i:2:p:147-166 DOI: 10.1007/s10683-006-7049-4
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Douglas D. Davis & Oleg Korenok, 2009. "Posted Offer Markets In Near-Continuous Time: An Experimental Investigation," Economic Inquiry, Western Economic Association International, vol. 47(3), pages 449-466, July.
    2. Edward L. Glaeser & David I. Laibson & José A. Scheinkman & Christine L. Soutter, 2000. "Measuring Trust," The Quarterly Journal of Economics, Oxford University Press, pages 811-846.
      • Glaeser, Edward Ludwig & Laibson, David I. & Scheinkman, Jose A. & Soutter, Christine L., 2000. "Measuring Trust," Scholarly Articles 4481497, Harvard University Department of Economics.
    3. Dimitri Dubois & Marc Willinger, 2007. "The role of players’ identification in the population on the trusting and the trustworthy behavior an experimental investigation," Working Papers 07-06, LAMETA, Universtiy of Montpellier, revised Jun 2007.
    4. Jordi Brandts & Gary Charness, 2011. "The strategy versus the direct-response method: a first survey of experimental comparisons," Experimental Economics, Springer;Economic Science Association, vol. 14(3), pages 375-398, September.
    5. repec:wly:emetrp:v:85:y:2017:i::p:915-935 is not listed on IDEAS
    6. Philippe Gillen & Alexander Rasch & Achim Wambach & Peter Werner, 2016. "Bid pooling in reverse multi-unit Dutch auctions: an experimental investigation," Theory and Decision, Springer, pages 511-534.
    7. Chen, Daniel L. & Schonger, Martin, 2016. "A Theory of Experiments: Invariance of Equilibrium to the Strategy Method of Elicitation and Implications for Social Preferences," TSE Working Papers 16-724, Toulouse School of Economics (TSE).
    8. Zacharias Maniadis, 2008. "Essays in Aggregate Information, The Media and Special Interests," Levine's Working Paper Archive 122247000000002258, David K. Levine.
    9. Olivier Ledoit, 2011. "Choice Democracy," ECON - Working Papers 038, Department of Economics - University of Zurich.
    10. Eva M. Krockow & Briony D. Pulford & Andrew M. Colman, 2015. "Competitive Centipede Games: Zero-End Payoffs and Payoff Inequality Deter Reciprocal Cooperation," Games, MDPI, Open Access Journal, vol. 6(3), pages 1-11, August.
    11. Timothy Cason & Lata Gangadharan, 2015. "Promoting cooperation in nonlinear social dilemmas through peer punishment," Experimental Economics, Springer;Economic Science Association, vol. 18(1), pages 66-88, March.

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