The Evolution of Reciprocal Preferences
A number of outstanding puzzles in economics may be resolved by recognizing that where members of a group benefit from mutual adherence to a social norm, agents may obey the norm and punish its violators, even when this behavior cannot be motivated by self-regarding, outcome-oriented preferences. This behavior, which we call strong reciprocity, is a form of altruism in that it benefits others at the expense of the individual exhibiting it. Thus where benefits and costs are measured in fitness terms and where the relevant behaviors are governed by genetic inheritance subject to natural selection, it is generally thought that, as a form of altruism, strong reciprocity cannot invade a population of self-interested types, nor can it be sustained in a stable population equilibrium. We show that strong reciprocity can invade a population of self-interested types and can be sustained in a stable population equilibrium, and we show that, under assumptions that appear to reflect the relevant social-environmental conditions, the model can account for the genetic evolution of strong reciprocity.
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Web page: http://www.santafe.edu/sfi/publications/working-papers.html
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