The Dynamics of Trustworthiness Among the Few

20 Pages Posted: 10 Feb 2003

See all articles by Sandra Gueth

Sandra Gueth

University of Bielefeld

Werner Guth

Max Planck Institute of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Harmut Kliemt

University of Duisberg

Abstract

Conventional stochastic models of evolutionary processes with infinitely many agents are deterministic models in disguise. Only finite population models become truly stochastic. Therefore this paper focuses on an indirect evolutionary model of pair wise interaction in a pool of three (corresponding to analysing oligopolies in terms of duopoly markets). The outcomes of the process over the long haul are characterized by the stationary distribution of the underlying Markov process. Our example indicates that intermediate cases cannot be seen as convex combinations of the two polar non-stochastic cases of two or infinitely many individuals.

JEL Classification: C72, C73

Suggested Citation

Gueth, Sandra and Güth, Werner and Kliemt, Harmut, The Dynamics of Trustworthiness Among the Few. Japanese Economic Review, Vol. 53, pp. 369-388, 2002. Available at SSRN: https://ssrn.com/abstract=369695

Sandra Gueth

University of Bielefeld

ZiF, Wellenberg 1
Department of Economics
33615 Bielefeld
Germany

Werner Güth (Contact Author)

Max Planck Institute of Economics ( email )

Kahlaische Strasse 10
D-07745 Jena, 07745
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Harmut Kliemt

University of Duisberg ( email )

Lotharstrasse 1
Duisburg, 47048
Germany

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