The Absent-Minded Prisoner
Greifswald Economics Working Paper No. 14/98
20 Pages Posted: 31 Oct 2000
Date Written: November 1998
If one of two rational players is absent-minded for at least three rounds, cooperation in a prisoners' dilemma with a finite number of repetitions is possible. If both players are absent-minded, even two rounds of absent-mindedness can be enough for cooperation in these rounds and all rounds before. Sufficient conditions for the existence of a cooperative equilibrium are derived, a plausible interpretation of absent-mindedness in the case of many repetitions is given.
JEL Classification: C72
Suggested Citation: Suggested Citation