Strategies for Noise, Uncertainty and Irrationality

Posted: 24 May 2011

See all articles by Anna Dreber

Anna Dreber

Stockholm School of Economics - Department of Economics

Date Written: May 24, 2011

Abstract

We explore to what extent social preferences, as measured by dictator game giving, explain cooperation in noisy repeated games. Giving is correlated with cooperation when the returns to cooperation are low, but there is no correlation when the returns to cooperation are high. There is also no correlation between dictator game giving and leniency (waiting for multiple defections before retaliating) or forgiveness (returning to cooperation after a retaliation). Furthermore, inequity aversion does not favor cooperative strategies, which are common in our data and earn high payoffs. We conclude that cooperation in repeated games is primarily motivated by long-term payoff maximization.

Suggested Citation

Dreber, Anna, Strategies for Noise, Uncertainty and Irrationality (May 24, 2011). Gruter Institute Squaw Valley Conference: Law, Institutions & Human Behavior, 2011, Available at SSRN: https://ssrn.com/abstract=1850762

Anna Dreber (Contact Author)

Stockholm School of Economics - Department of Economics ( email )

P.O. Box 6501
Sveavagen 65
S-113 83 Stockholm
Sweden

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
314
PlumX Metrics