Partner Selection Supported by Opaque Reputation Promotes Cooperative Behavior
Judgment and Decision Making, Vol. 11, No. 6, November 2016, pp. 589-600
12 Pages Posted: 8 Oct 2016 Last revised: 19 Feb 2018
Date Written: October 6, 2016
Reputation plays a major role in human societies, and it has been proposed as an explanation for the evolution of cooperation. While the majority of previous studies equates reputation with a transparent and complete history of players' past decisions, in real life, reputations are often ambiguous and opaque. Using web-based experiments, we explore the extent to which opaque reputation works in isolating defectors, with and without partner selection opportunities. Our results show that low reputation works as a signal of untrustworthiness, whereas medium or high reputation are not taken into account by participants for orienting their choices. We also find that reputation without partner selection does not promote cooperative behavior; that is, defectors do not turn into cooperators only for the sake of getting a positive reputation. Finally, in a third study, we find that, when reputation is pivotal to selection, then a substantial proportion of would-be defectors turn into cooperators. Taken together, these results provide insights on the characteristics of reputation and on the way in which humans make use of it when selecting partners but also when knowing that they will be selected.
Keywords: reputation, partner selection, cooperation, prisoner's dilemma, online transactions
JEL Classification: C70, C79, C90, C91, C92, D64, D70, D71, H41
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