An epistemic approach to explaining cooperation in the finitely repeated Prisoner’s Dilemma

We use epistemic game theory to explore rationales behind cooperative behaviors in the finitely repeated Prisoner’s Dilemma. For a class of type structures that are sufficiently rich, the set of outcomes that can arise when each player i is rational and satisfies $$(m_i-1)$$ ( m i - 1 ) th order strong belief of rationality is the set of paths on which each player i defects in the last $$m_i$$ m i rounds. We construct one sufficiently rich type structure to elaborate on how different patterns of cooperative behaviors arise under sufficiently weak epistemic conditions. In this type structure, the optimality of forgiving the opponent’s past defection and the belief that one’s defection will be forgiven account for the richness of the set of behavior outcomes.

PERIODIC STRATEGIES II: GENERALIZATIONS AND EXTENSIONS

At a mixed Nash equilibrium, the payoff of a player does not depend on her own action, as long as her opponent sticks to his. In a periodic strategy, a concept developed in a previous paper [V. K. Oikonomou and J. Jost, Periodic strategies: A new solution concept and an algorithm for nontrivial strategic form games, Adv. Compl. Syst. 20(5) (2017) 1750009], in contrast, the own payoff does not depend on the opponent’s action. Here, we generalize this to multi-player simultaneous perfect information strategic form games. We show that also in this class of games, there always exists at least one periodic strategy, and we investigate the mathematical properties of such periodic strategies. In addition, we demonstrate that periodic strategies may exist in games with incomplete information; we shall focus on Bayesian games. Moreover, we discuss the differences between the periodic strategies formalism and cooperative game theory. In fact, the periodic strategies are obtained in a purely non-cooperative way, and periodic strategies are as cooperative as the Nash equilibria are. Finally, we incorporate the periodic strategies in an epistemic game theory framework, and discuss several features of this approach.

Superrational types

We present a formal analysis of Douglas Hofstadter’s concept of superrationality. We start by defining superrationally justifiable actions, and study them in symmetric games. We then model the beliefs of the players, in a way that leads them to different choices than the usual assumption of rationality by restricting the range of conceivable choices. These beliefs are captured in the formal notion of type drawn from epistemic game theory. The theory of coalgebras is used to frame type spaces and to account for the existence of some of them. We find conditions that guarantee superrational outcomes.