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The emergence of reciprocally beneficial cooperation


  • Sergio Beraldo


  • Robert Sugden



This paper offers a new and robust model of the emergence and persistence of cooperation. In the model, interactions are anonymous, the population is well-mixed, and the evolutionary process selects strategies according to material payoffs. The cooperation problem is modelled as a game similar to Prisoner’s Dilemma, but there is an outside option of nonparticipation and the payoff to mutual cooperation is stochastic; with positive probability, this payoff exceeds that from cheating against a cooperator. Under mild conditions, mutually beneficial cooperation occurs in equilibrium. This is possible because the non-participation option holds down the equilibrium frequency of cheating.

Suggested Citation

  • Sergio Beraldo & Robert Sugden, 2010. "The emergence of reciprocally beneficial cooperation," ICER Working Papers 18-2010, ICER - International Centre for Economic Research.
  • Handle: RePEc:icr:wpicer:18-2010

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    References listed on IDEAS

    1. Joseph Henrich, 2001. "In Search of Homo Economicus: Behavioral Experiments in 15 Small-Scale Societies," American Economic Review, American Economic Association, vol. 91(2), pages 73-78, May.
    2. Samuel Bowles & Robert Boyd & Colin Camerer & Ernst Fehr & Herbert Gintis & Joseph Henrich & Richard McElreath, 2001. "In search of homo economicus: Experiments in 15 small-scale societies," Artefactual Field Experiments 00068, The Field Experiments Website.
    3. Nikiforakis, Nikos, 2008. "Punishment and counter-punishment in public good games: Can we really govern ourselves," Journal of Public Economics, Elsevier, vol. 92(1-2), pages 91-112, February.
    4. Simon Gachter & Ernst Fehr, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September.
    5. Ken Binmore, 1998. "Game Theory and the Social Contract - Vol. 2: Just Playing," MIT Press Books, The MIT Press, edition 1, volume 2, number 0262024446, January.
    6. Ochea, Marius-Ionut, 2013. "Evolution of repeated prisoner's dilemma play under logit dynamics," Journal of Economic Dynamics and Control, Elsevier, vol. 37(12), pages 2483-2499.
    7. Ken Binmore, 1994. "Game Theory and the Social Contract, Volume 1: Playing Fair," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262023636, January.
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    Cited by:

    1. Sergio Beraldo, 2011. "Good standing and cooperation," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 58(1), pages 79-90, March.
    2. repec:eee:apmaco:v:315:y:2017:i:c:p:494-499 is not listed on IDEAS

    More about this item


    Cooperation; voluntary participation; random payoffs.;

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

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