Revealed reputations in the finitely-repeated prisoners’ dilemma

Cox, C.A.; Jones, M.T.; Pflum, K.E.; Healy, P.J.

Abstract

In a sequential-move, finitely repeated prisoners’ dilemma game (FRPD), cooperation can be sustained if the first-mover believes her opponent might be a behavioral type who plays a tit-for-tat strategy in every period. We test this theory by revealing second-mover histories from an earlier FRPD experiment to their current opponent. Despite eliminating the possibility of reputation-building, aggregate cooperation actually increases when histories are revealed. Cooperative histories lead to increased trust, but negative histories do not cause decreased trust. We develop a behavioral model to explain these findings.

Citation

Cox, C., Jones, M., Pflum, K., & Healy, P. (2015). Revealed reputations in the finitely-repeated prisoners’ dilemma. Economic Theory, 58(3), 441-484. https://doi.org/10.1007/s00199-015-0863-1

• Journal Article Type: Article
• Acceptance Date: Jan 27, 2015
• Online Publication Date: Feb 14, 2015
• Publication Date: Apr 1, 2015
• Deposit Date: Jan 24, 2015
• Publicly Available Date: Feb 3, 2015
• Journal: Economic Theory
• Print ISSN: 0938-2259
• Electronic ISSN: 1432-0479
• Publisher: Springer
• Peer Reviewed: Peer Reviewed
• Volume: 58
• Issue: 3
• Pages: 441-484
• DOI: https://doi.org/10.1007/s00199-015-0863-1
• Keywords: Prisoners’ dilemma, Finitely-repeated games, Cooperation, Reputation-building.
• Public URL: https://durham-repository.worktribe.com/output/1416159