A One-Shot Prisoners' Dilemma With Procedural Utility
This article introduces a model of rationality that combines procedural utility over actions with consequential utility over payoffs. It applies the model to the Prisoners' Dilemma and shows that empirically observed cooperative behaviors can be rationally explained by a procedural utility for cooperation. The model characterizes the situations in which cooperation emerges as a Nash equilibrium. When rational individuals are not solely concerned by the consequences of their behavior but also care for the process by which these consequences are obtained, there is no one single rational solution to a Prisoners' Dilemma. Rational behavior depends on the payoffs at stake and on the procedural utility of individuals. In this manner, this model of procedural utility reflects how ethical considerations, social norms or emotions can transform a game of consequences.
Volume (Year): 08 (2006)
Issue (Month): 04 ()
|Contact details of provider:|| Web page: http://www.worldscinet.com/igtr/igtr.shtml|
|Order Information:|| Email: |
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bruno S. Frey & Alois Stutzer, .
"Beyond Outcomes: Measuring Procedural Utility,"
IEW - Working Papers
076, Institute for Empirical Research in Economics - University of Zurich.
- Frey, Bruno S. & Stutzer, Alois, 2002. "Beyond Outcomes: Measuring Procedural Utility," Berkeley Olin Program in Law & Economics, Working Paper Series qt7qp9q1js, Berkeley Olin Program in Law & Economics.
- Hammond, P.J. & , ., 1987. "Consequentialist foundations for expected utility," CORE Discussion Papers 1987016, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Matthew Rabin., 1992.
"Incorporating Fairness into Game Theory and Economics,"
Economics Working Papers
92-199, University of California at Berkeley.
- Rabin, Matthew, 1993. "Incorporating Fairness into Game Theory and Economics," American Economic Review, American Economic Association, vol. 83(5), pages 1281-1302, December.
- M. Rabin, 2001. "Incorporating Fairness into Game Theory and Economics," Levine's Working Paper Archive 511, David K. Levine.
- 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.
- Kreps, David M. & Milgrom, Paul & Roberts, John & Wilson, Robert, 1982. "Rational cooperation in the finitely repeated prisoners' dilemma," Journal of Economic Theory, Elsevier, vol. 27(2), pages 245-252, August.
- Werlang, Sérgio Ribeiro da Costa, 1988. "Common knowledge," Economics Working Papers (Ensaios Economicos da EPGE) 118, FGV/EPGE Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil).
- Osborne, M-J & Rubinstein, A, 1997.
"Games with Procedurally Rational Players,"
4-97, Tel Aviv.
- Sen, A., 1996.
"Maximisation and the Act of Choice,"
270, Banca Italia - Servizio di Studi.
- Amartya Sen, 1996. "Maximization and the Act of Choice," Harvard Institute of Economic Research Working Papers 1766, Harvard - Institute of Economic Research.
- Simon, Herbert A, 1978. "Rationality as Process and as Product of Thought," American Economic Review, American Economic Association, vol. 68(2), pages 1-16, May.
- Martin J Osborne & Ariel Rubinstein, 2009.
"A Course in Game Theory,"
814577000000000225, UCLA Department of Economics.
- Marc Le Menestrel, 2001.
"A Process Approach to the Utility for Gambling,"
Theory and Decision,
Springer, vol. 50(3), pages 249-262, May.
- Vogt, Carsten, 2000. "The evolution of cooperation in Prisoners' Dilemma with an endogenous learning mutant," Journal of Economic Behavior & Organization, Elsevier, vol. 42(3), pages 347-373, July.
- Loch, Christoph H. & Huberman, Bernardo A. & Stout, Suzanne, 2000. "Status competition and performance in work groups," Journal of Economic Behavior & Organization, Elsevier, vol. 43(1), pages 35-55, September.
- Marc Le Menestrel & Luk N. Van Wassenhove, 2001.
"The domain and interpretation of utility functions: An exploration,"
Economics Working Papers
576, Department of Economics and Business, Universitat Pompeu Fabra.
- Marc Le Menestrel & Luk Van Wassenhove, 2001. "The Domain and Interpretation of Utility Functions: An Exploration," Theory and Decision, Springer, vol. 51(2), pages 329-349, December.
- Michihiro Kandori, 1992. "Social Norms and Community Enforcement," Review of Economic Studies, Oxford University Press, vol. 59(1), pages 63-80.
- Gilboa, Itzhak & Schmeidler, David, 1988.
"Information dependent games : Can common sense be common knowledge?,"
Elsevier, vol. 27(3), pages 215-221.
- Itzhak Gilboa & David Schmeidler, 1988. "Information Dependent Games: Can Common Sense Be Common Knowledge?," Post-Print hal-00753242, HAL.
- Robson, Arthur J, 1992. "Status, the Distribution of Wealth, Private and Social Attitudes to Risk," Econometrica, Econometric Society, vol. 60(4), pages 837-57, July.
- Bester, H. & Güth, W., 1994.
"Is altruism evolutionarily stable ?,"
1994-103, Tilburg University, Center for Economic Research.
When requesting a correction, please mention this item's handle: RePEc:wsi:igtrxx:v:08:y:2006:i:04:p:655-668. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Tai Tone Lim)
If references are entirely missing, you can add them using this form.