scholarly journals On the Determinants of Cooperation in Infinitely Repeated Games: A Survey

2018 ◽  
Vol 56 (1) ◽  
pp. 60-114 ◽  
Author(s):  
Pedro Dal Bó ◽  
Guillaume R. Fréchette
Keyword(s):  
Experimental Data ◽  
Repeated Games ◽  
Multiple Equilibria ◽  
Prisoner’S Dilemma ◽  
Personal Characteristics ◽  
Repeated Game ◽  
Experimental Literature ◽  
Imperfect Monitoring ◽  
Strategic Uncertainty ◽  
Infinitely Repeated Games

A growing experimental literature studies the determinants of cooperation in infinitely repeated games, tests different predictions of the theory, and suggests an empirical solution to the problem of multiple equilibria. To provide a robust description of the literature's findings, we gather and analyze a metadata set of experiments on infinitely repeated prisoner's dilemma games. The experimental data show that cooperation is affected by infinite repetition and is more likely to arise when it can be supported in equilibrium. However, the fact that cooperation can be supported in equilibrium does not imply that most subjects will cooperate. High cooperation rates will emerge only when the parameters of the repeated game are such that cooperation is very robust to strategic uncertainty. We also review the results regarding the effect of imperfect monitoring, changing partners, and personal characteristics on cooperation and the strategies used to support it. (JEL C71, C73, D81, D83)

scholarly journals The Impact of Monitoring in Infinitely Repeated Games: Perfect, Public, and Private

2019 ◽  
Vol 11 (1) ◽  
pp. 1-43 ◽  
Author(s):  
Masaki Aoyagi ◽  
V. Bhaskar ◽  
Guillaume R. Fréchette
Keyword(s):  
Laboratory Experiment ◽  
Repeated Games ◽  
Imperfect Monitoring ◽  
Public And Private ◽  
Private Monitoring ◽  
Stage Game ◽  
The Impact ◽  
Public Monitoring ◽  
Perfect Monitoring ◽  
Infinitely Repeated Games

This paper uses a laboratory experiment to study the effect of the monitoring structure on the play of the infinitely repeated prisoner’s dilemma. Keeping the strategic form of the stage game fixed, we examine the behavior of subjects when information about past actions is perfect (perfect monitoring), noisy but public (public monitoring), and noisy and private (private monitoring). We find that the subjects sustain cooperation in every treatment, but that their strategies differ across the three treatments. Specifically, the strategies under imperfect monitoring are both more complex and more lenient than those under perfect monitoring. The results show how the changes in strategies across monitoring structures mitigate the effect of noise in monitoring on efficiency. (JEL C72, C73, C92, D82, D83)

scholarly journals Behavioral Theory of Repeated Prisoner’s Dilemma: Generous Tit-For-Tat Strategy

2019 ◽  
Vol 20 (1) ◽  
Author(s):  
Hitoshi Matsushima
Keyword(s):  
Repeated Games ◽  
Prisoner's Dilemma ◽  
Social Preference ◽  
Prisoner’S Dilemma ◽  
Self Interest ◽  
Additive Separability ◽  
Tit For Tat ◽  
Strategic Complexity ◽  
Infinitely Repeated Games ◽  
Psychological Mood

AbstractThis study investigates infinitely repeated games of a prisoner’s dilemma with additive separability in which the monitoring technology is imperfect and private. Behavioral incentives indicate that a player is not only motivated by pure self-interest but also by social preference such as reciprocity, and that a player often becomes naïve and selects an action randomly due to her cognitive limitation and uncertain psychological mood as well as the strategic complexity caused by monitoring imperfection and private observation. By focusing on generous tit-for-tat strategies, we characterize a behavioral version of Nash equilibrium termed behavioral equilibrium in an accuracy-contingent manner. By eliminating the gap between theory and evidence, we show that not pure self-interest but reciprocity plays a substantial role in motivating a player to make decisions in a sophisticated manner.

scholarly journals The Evolution of Cooperation in Infinitely Repeated Games: Experimental Evidence

2011 ◽  
Vol 101 (1) ◽  
pp. 411-429 ◽  
Author(s):  
Pedro Dal Bó ◽  
Guillaume R Fréchette
Keyword(s):  
Experimental Evidence ◽  
Repeated Games ◽  
Prisoner's Dilemma ◽  
Prisoner’S Dilemma ◽  
Evolution Of Cooperation ◽  
Risk Dominance ◽  
Repeated Prisoner’S Dilemma ◽  
Infinitely Repeated Games ◽  
Repeated Prisoner's Dilemma ◽  
Present Experimental Evidence

A usual criticism of the theory of infinitely repeated games is that it does not provide sharp predictions since there may be a multiplicity of equilibria. To address this issue, we present experimental evidence on the evolution of cooperation in infinitely repeated prisoner's dilemma games as subjects gain experience. We show that cooperation may prevail in infinitely repeated games, but the conditions under which this occurs are more stringent than the subgame perfect conditions usually considered or even a condition based on risk dominance. (JEL C71, C73)

scholarly journals Toward a Theory of Discounted Repeated Games with Imperfect Monitoring

Econometrica ◽  
1990 ◽  
Vol 58 (5) ◽  
pp. 1041 ◽  
Author(s):  
Dilip Abreu ◽  
David Pearce ◽  
Ennio Stacchetti
Keyword(s):  
Repeated Games ◽  
Imperfect Monitoring

Infinitely-repeated games with endogenous discounting

1996 ◽  
Vol 52 (2) ◽  
pp. 163-169 ◽  
Author(s):  
William S. Neilson ◽  
Harold Winter
Keyword(s):  
Repeated Games ◽  
Endogenous Discounting ◽  
Infinitely Repeated Games

scholarly journals Cooperation between Emotional Players

Games ◽  
2020 ◽  
Vol 11 (4) ◽  
pp. 45
Author(s):  
Lina Andersson
Keyword(s):  
Repeated Games ◽  
Stochastic Games ◽  
The State ◽  
The Other ◽  
States Of Mind ◽  
Finitely Repeated Games ◽  
Prisoners Dilemma ◽  
State Of Mind ◽  
Infinitely Repeated Games

This paper uses the framework of stochastic games to propose a model of emotions in repeated interactions. An emotional player can be in either a friendly, a neutral, or a hostile state of mind. The player transitions between the states of mind as a response to observed actions taken by the other player. The state of mind determines the player’s psychological payoff which together with a material payoff constitutes the player’s utility. In the friendly (hostile) state of mind the player has a positive (negative) concern for other players’ material payoffs. This paper shows how emotions can both facilitate and obstruct cooperation in a repeated prisoners’ dilemma game. In finitely repeated games a player who cares only for their own material payoffs can have an incentive to manipulate an emotional player into the friendly state of mind. In infinitely repeated games with two emotional players less patience is required to sustain cooperation. However, emotions can also obstruct cooperation if they make the players unwilling to punish each other, or if the players become hostile when punished.

Endogenous Monitoring in a Partnership Game

2020 ◽  
Vol 110 (3) ◽  
pp. 776-796
Author(s):  
Anna Sanktjohanser
Keyword(s):  
United States ◽  
The United States ◽  
Repeated Game ◽  
Discount Factor ◽  
Imperfect Monitoring ◽  
Monitoring Cost ◽  
Private Signals ◽  
Public Message

I consider a repeated game in which, due to imperfect monitoring, no collusion can be sustained. I add a self-interested monitor who commits to obtain private signals of firms’ actions and sends a public message. The monitor makes an offer specifying the precision of the signals obtained and the amount to be paid in return. First, with a low monitoring cost, collusive equilibria exist. Second, collusive equilibria are monitor-preferred. Third, in monitor-preferred equilibria, firms’ payoffs are decreasing in the discount factor. My model helps explain cartel agreements between self-interested parties and firms in legal industries in the United States and Europe. (JEL C73, D43, D82, L12)

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