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Observability of Partners’ Past Play and Cooperation: Experimental Evidence

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  • Kenju Kamei
  • Hajime Kobayashi
  • Tiffany Tsz Kwan Tse

Abstract

The observability of partners’ past play is known to theoretically improve cooperation in an infinitely repeated prisoner’s dilemma game under random matching. This paper presents evidence from an incentivized experiment that reputational information per se may not improve cooperation. A structural estimation suggests that a certain percentage of players act according to the “Always Defect” strategy, whether or not the reputational information is available. The remaining players adopt available cooperative strategies: specifically, the tit-for-tat strategy when reputational information is not available, and a strategy that conditions on the matched partner’s past play when reputational information is available.

Suggested Citation

  • Kenju Kamei & Hajime Kobayashi & Tiffany Tsz Kwan Tse, 2021. "Observability of Partners’ Past Play and Cooperation: Experimental Evidence," ISER Discussion Paper 1145, Institute of Social and Economic Research, Osaka University.
    • Handle: RePEc:dpr:wpaper:1145
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    References listed on IDEAS

    as
    1. Drew Fudenberg & David G. Rand & Anna Dreber, 2012. "Slow to Anger and Fast to Forgive: Cooperation in an Uncertain World," American Economic Review, American Economic Association, vol. 102(2), pages 720-749, April.
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    More about this item

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General

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