Jung, Hanjoon Michael (2007): Preference-based Cooperation in a Prisoner's Dilemma Game.
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This paper studies the possibility of whole population cooperation based on players' preferences. Consider the following infinitely repeated game, similar to Ghosh and Ray (1996). At each stage, uncountable numbers of players are randomly matched without information about their partners' past actions and play a prisoner's dilemma game. The players have the option to continue their relationship, and they all have the same discount factor. Also, they have two possible types: high ability player (H) or low ability player (L). H can produce better outcomes for its partner as well as for itself than L can. I look for an equilibrium that is robust against both pair-wise deviation and individual deviation and call such equilibrium a social equilibrium. In this setting, long-term cooperative behavior among the whole population can take place in a social equilibrium because of the players' preferences for their partners' types. In addition, a folk theorem of this model is proposed.
|Item Type:||MPRA Paper|
|Institution:||Lahore University of Management Sciences|
|Original Title:||Preference-based Cooperation in a Prisoner's Dilemma Game|
|Keywords:||Folk theorem; Random-matching; Social equilibrium; Type-based payoffs|
|Subjects:||C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C71 - Cooperative Games
C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C78 - Bargaining Theory; Matching Theory
|Depositing User:||Hanjoon Michael Jung|
|Date Deposited:||30. Nov 2007 00:08|
|Last Modified:||26. Feb 2013 17:15|
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Available Versions of this Item
Preference-based Cooperation in a Prisoner's Dilemma Game: Whole Population Cooperation without Information Flow across Matches. (deposited 31. Aug 2007)
- Preference-based Cooperation in a Prisoner's Dilemma Game. (deposited 30. Nov 2007 00:08) [Currently Displayed]