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Social surplus determines cooperation rates in the one-shot Prisoner's Dilemma

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  • Luca Rigotti

Abstract

We provide evidence on how cooperation rates vary across payoff parameters in the Prisoner’s Dilemma (PD), using four one-shot games that differ only in the payoffs from mutual cooperation. In our experiment, participants play only the PD game, and play the game once and only once, so there are no potential confounds or methodological issues. Our results show that higher monetary payoffs from cooperation are associated with substantially higher cooperation rates, which increase monotonically from 23% to 60%. Participants’ beliefs about cooperation rates track closely actual cooperation rates: higher cooperation is expected from others when mutual cooperation payoffs are higher. This is true also for participants who, in a follow-up experiment, only make guesses about the choices of others.

Suggested Citation

  • Luca Rigotti, 2016. "Social surplus determines cooperation rates in the one-shot Prisoner's Dilemma," Working Paper 5877, Department of Economics, University of Pittsburgh.
    • Handle: RePEc:pit:wpaper:5877
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    21. Hans-Theo Normann & Martin Sternberg, 2021. "Human-Algorithm Interaction: Algorithmic Pricing in Hybrid Laboratory Markets," Discussion Paper Series of the Max Planck Institute for Behavioral Economics 2021_11, Max Planck Institute for Behavioral Economics, revised 13 Apr 2022.
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    25. Chakraborty, Anujit, 2023. "Motives behind cooperation in finitely repeated prisoner's dilemma," Games and Economic Behavior, Elsevier, vol. 141(C), pages 105-132.

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    More about this item

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles

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