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Long-term commitment and cooperation

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  • Frédéric Schneider
  • Roberto A. Weber

Abstract

We study how the willingness to enter long-term bilateral relationships affects cooperation even when parties have little information about each other, ex ante, and cooperation is otherwise unenforceable. We experimentally investigate a finitely-repeated Prisoner’s Dilemma, allowing players to endogenously select interaction durations. Consistent with prior research, longer interactions facilitate cooperation. However, many individuals avoid long-term commitment, with uncooperative types less likely to commit than conditional cooperators. Endogenously chosen long-term commitment yields higher cooperation rates (98% in one condition) than exogenously imposed commitment. Thus, the willingness to enter into long-term relationships provides a means for fostering - and screening for - efficient cooperation.

Suggested Citation

  • Frédéric Schneider & Roberto A. Weber, 2013. "Long-term commitment and cooperation," ECON - Working Papers 130, Department of Economics - University of Zurich.
    • Handle: RePEc:zur:econwp:130
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    References listed on IDEAS

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    Cited by:

    1. Matthew Embrey & Guillaume R Fréchette & Sevgi Yuksel, 2018. "Cooperation in the Finitely Repeated Prisoner’s Dilemma," The Quarterly Journal of Economics, Oxford University Press, vol. 133(1), pages 509-551.
    2. Kamei, Kenju, 2019. "Cooperation and Endogenous Repetition in an Infinitely Repeated Social Dilemma: Experimental Evidence," MPRA Paper 92097, University Library of Munich, Germany.
    3. Lorna Zischka, 2016. "The Interaction between Prosocial (Giving) Behaviours and Social Cohesion," Economics & Management Discussion Papers em-dp2016-07, Henley Business School, Reading University.

    More about this item

    Keywords

    Repeated games; cooperation; voluntary commitment;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles

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