Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259923 
Year of Publication: 
2005
Series/Report no.: 
Working Paper No. 2005:45
Publisher: 
Lund University, School of Economics and Management, Department of Economics, Lund
Abstract: 
We analyze a cooperation game in an evolutionary environment. Agents make noisy observations of opponents' propensity to cooperate, called reputation, and form preferences over opponents based on their reputation. A game takes place when two agents agree to play. Pareto optimal cooperation is evolutionarily stable when reputation perfectly reflects propensity to cooperate. With some reputation noise, there will be at least some cooperation. Individual concern for reputation results in a seemingly altruistic behavior. The degree of cooperation is decreasing in anonymity. If reputation is noisy enough, there is no cooperation in equilibrium.
Subjects: 
Cooperation
Conditioned Strategies
Prisoners Dilemma
Signaling
Reputation
Altruism
Evolutionary Equilibrium
JEL: 
C70
C72
Document Type: 
Working Paper

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