American Economic Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Cooperation, but No Reciprocity: Individual Strategies in the Repeated Prisoner's Dilemma
American Economic Review
vol. 105,
no. 9, September 2015
(pp. 2882–2910)
Abstract
In the repeated prisoner's dilemma, predictions are notoriously difficult. Recently, however, Blonski, Ockenfels, and Spagnolo (2011)—henceforth, BOS‐showed that experimental subjects predictably cooperate when the discount factor exceeds a particular threshold. I analyze individual strategies in four recent experiments to examine whether strategies are predictable, too. Behavior is well summarized by "Semi-Grim" strategies: cooperate after mutual cooperation, defect after mutual defection, randomize otherwise. This holds both in aggregate and individually, and it explains the BOS-threshold: Semi-Grim equilibria appear as the discount factor crosses this threshold, and then, subjects start cooperating in round 1 and switch to Semi-Grim in continuation play. (JEL C72, C73, C92, D12)Citation
Breitmoser, Yves. 2015. "Cooperation, but No Reciprocity: Individual Strategies in the Repeated Prisoner's Dilemma." American Economic Review, 105 (9): 2882–2910. DOI: 10.1257/aer.20130675Additional Materials
JEL Classification
- C72 Noncooperative Games
- C73 Stochastic and Dynamic Games; Evolutionary Games; Repeated Games
- C92 Design of Experiments: Laboratory, Group Behavior
- D12 Consumer Economics: Empirical Analysis