History of Cooperation: A Positive Analysis of the Overlapping Mechanism
22 Pages Posted: 25 Apr 2015
Date Written: April 9, 2015
Given that cooperation can lead to a large cost for an individual there must be some social mechanisms maintaining this behavior. Recently, some economists have used game theory to provide a theoretical understanding of the mechanisms at play. For instance using the overlapping generation game, it has been shown that rewards and penalties given in the past and those perceived to occur in the future has a large influence on the players willingness to cooperate. However while these mathematical arguments are persuasive whether such equilibrium exists in the real world requires empirical observation. To date there are some empirical evidence focused on case studies but these tend to lack enough information to validate the theory. Therefore our objective is to provide evidence for the theory that the overlapping mechanism influences cooperative behavior by using the overlapping generation game in economic experiments. We would like to show how the path of the equilibrium is affected by the history of previous subject’s choices through comparing a game with and without an overlapping mechanism.
Keywords: cooperation, mechanism, overlapping, social preference
JEL Classification: C92, D03
Suggested Citation: Suggested Citation