Cooperation Through Imitation and Exclusion In Networks

34 Pages Posted: 9 Aug 2009

See all articles by Constanza Fosco

Constanza Fosco

Charles III University of Madrid

Friederike Mengel

Maastricht University

Date Written: August 4, 2009

Abstract

We develop a simple model to study the coevolution of interaction structures and action choices in Prisoners’ Dilemma games. Agents are boundedly rational and choose both actions and interaction partners via payoff-based imitation. The dynamics of imitation and exclusion yields polymorphic outcomes under a wide range of parameters. Depending on the parameters of the model two scenarios can arise. Either there is 'full separation' of defectors and cooperators, i.e. they are found in two different, disconnected components. Or there is 'marginalization' of defectors, i.e. connected networks emerge with a center of cooperators and a periphery of defectors. Simulations confirm our analytical results and show that the share of cooperators increases with the speed at which the network evolves, increases with the radius of interaction and decreases with the radius of information of agents.

Keywords: Game Theory, Cooperation, Imitation Learning, Network Formation

JEL Classification: C70, C73, D85

Suggested Citation

Fosco, Constanza and Mengel, Friederike, Cooperation Through Imitation and Exclusion In Networks (August 4, 2009). FEEM Working Paper No. 37.2009, Available at SSRN: https://ssrn.com/abstract=1443796 or http://dx.doi.org/10.2139/ssrn.1443796

Constanza Fosco

Charles III University of Madrid ( email )

CL. de Madrid 126
Madrid, Madrid 28903
Spain

Friederike Mengel (Contact Author)

Maastricht University ( email )

Maastricht, Limburg

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