Social Dilemmas: The Anatomy of Cooperation

Summary of: Social Dilemmas: The Anatomy of Cooperation

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Kollock provides a literature review and taxonomy of social dilemma models and social dilemma solutions, as well as current issues and future directions of studying social dilemmas.


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Published in/by
Annual Review of Sociology, 24: 183-214
August 1998


  • Social dilemmas reflect a ‘deficient equilibrium’ because there is at least another outcome in which everyone is better off, but nobody has an incentive to change their behavior. Shaping and managing incentives is critical for shifting out of situations of deficient equilibrium. It's an equilibrium because two players, in the absence of certainty about how the other is going to act, choose the least damaging strategy for themselves -- assuming that the other will defect – and their strategies, taken together, represent a logical balance. It's a deficient balance because if they each had chosen to cooperate, their strategies, taken together, would have paid off better for both.
  • If you reward individuals, they have less incentive to work as a group, but if you reward only the group, they have no choice but to work for the common goal.
  • Moving from 2 person to N person dilemmas crosses a threshold in which anonymity becomes possible and free riding becomes more significant because not all actions are transparent to all actors. As N increases the costs one can impose on those who fail to cooperate are diffused and diluted, thus having less impact.
  • Three mythic narratives have shaped research and thinking about social dilemmas: the prisoner’s dilemma, the creation of public goods, and the tragedy of the commons. While these narratives can limit our thinking, they point to three critical challenges for overcoming social dilemmas: developing trust to secure transactions, overcoming the “social fence” of incurring immediate individual cost to generate a shared benefit (or public good), and overcoming the temptation to obtain immediate individual benefit that produces a shared cost for others.
  • The role of communication is significant in shaping cooperation with the context of prisoner’s dilemmas. Information gathering about behaviors, explicit promises regarding future behavior, persuasion, and the ability to establish group identity are all critical communication activities that increase the likelihood of cooperation.
  • The expectation of reciprocity can effect situations and moderate temptations to defect (free ride or abuse commons). The expectation of in-group reciprocity (if you think someone is going to participate, you will) seems to serve as a very deep heuristic that shapes strategic decisions about social dilemmas.
  • Cooperation rates are tied to payoff structures; changing the payoff structure or clearly communicating it can change the level of cooperation. Cooperation rates increase as payoffs increase, even when they just increase for others. If a dilemma is structured such that individuals have an effect on the outcome, the cooperation rate can increase.
  • Transforming social dilemmas is sometime more effective, and easier, than trying to solve them as they exist. For example, increasing communication or sense of affiliation (group identity) can transform a prisoner’s dilemma to an assurance game and increase the likelihood of cooperation. Looking for way to transform the context and nature of the dilemma is another important path for solving social dilemmas.
  • Some people are, by nature, more likely to trust others. In order to solve both the first-order dilemma (how to agree to organize collective action) and the second order dilemma (who’s going to police the agreement), you need both kinds of people: the more trusting people are necessary in order to make an agreement, and the less trusting people are necessary in order to police the agreement.

“The study of social dilemmas is the study of the tension between individual and collective rationality. In a social dilemma, individually reasonable behavior leads to a situation in which everyone is worse off. The first part of this review is a discussion of categories of social dilemmas and how they are modeled.” The Prisoner’s Dilemma, the problem of providing public goods, and Hardin’s Tragedy of the Commons are three powerful metaphors that facilitated and structured research but also served as blinders since their limitations are often not recognized.


Kollock’s analysis divides dilemmas into two-person and N-person dilemmas. The key two-person dilemmas are the Prisoner’s Dilemma, the Assurance Game, and the Chicken Game. Each of these models is defined by the ordering of four possible outcomes: mutual cooperation, mutual defection, and either first or second person’s unilateral defection. Each of these outcomes generates an individual benefit for each person and is ordered by the benefit for the first person.

The Prisoner’s Dilemma models unsecured transactions, e.g. buying and selling over the Internet. The best outcome of a Prisoner’s Dilemma is unilateral defection of the first person, followed by mutual cooperation, mutual defection, and the worst outcome is the first person’s unilateral cooperation. Since defection has the highest potential benefit and cooperation the highest potential risk, the equilibrium of the Prisoner’s Dilemma is mutual defection. This equilibrium is deficient because the best outcome for both players is mutual cooperation.

The Assurance Game is similar to the Prisoner’s Dilemma except it models situations where mutual cooperation is more benefical for each player than unilateral defection, e.g. a project that requires collaboration. This extra motivation to mutually cooperate creates two equilibria, one optimal, which is mutual cooperation, and one deficient, which is mutual defection. The optimal equilibrium requires trust between the two persons sufficient to assure each other that the other will cooperate. Insufficient trust leads to the deficient equilibrium.

The Chicken Game is again similar to the Prisoner's Dilemma except mutual defection is the worst outcome, worse than unilateral cooperation. This replaces the Prisoner’s Dilemma’s mutual defection equilibrium by two equilibria, unilateral defection and unilateral cooperation because of the strong motivation to not mutually defect. The Chicken Game is a model for situations that require volunteer effort to avoid the worst outcome but where duplicate effort is less desirable.

Kollock divides N-person dilemmas into two types based on cost and benefit for each individual. The first type is known as the social fence,s where an individual is presented with an immediate cost that generates a benefit shared by all. The individual wants to avoid the cost but if all do, everyone is worse off. A common metaphor of the social fence is the provisioning of public goods, which are (to a varying degree) non-excludable and nonrival. The key characteristic of a public good dilemma is the production function which defines the relationship between the level of resources contributed and the level of public good provided. Production functions are classified into decelarating, linear, accelerating, and step functions. Various production functions can produce N-person versions of any of the 2-person dilemmas.

The second type is know as social trap where the “individual is tempted by an immediate benefit that produces a cost to all. If all succumb to the temptation, the outcome is a collective disaster.” The usual metaphor of the social trap is the tragedy of the commons. A key feature of commons dilemmas is that the benefits are non-excludable (or difficult to make excludable) and subtractable. The key characteristic of commons dilemmas is the carrying capacity of the commons which depends on the replenishment rate of the subtractable joint resource.

Important (but not inevitable) features that affect N-person dilemma dynamics and contrast them to two-person dilemmas are anonymity, diffusion of defection cost, and little or no direct control on others. Some of these features are also found in two-person dilemmas, e.g. blaming defection on out-of-control circumstances is a form of anonymity in two-person games.


“The second part of [Kollock’s paper] is an extended treatment of possible solutions for social dilemmas. These solutions are organized into three broad categories based on whether the solutions assume egoistic actors and whether the structure of the situation can be changed: Motivational solutions assume actors are not completely egoistic and so give some weight to the outcomes of their partners. Strategic solutions assume egoistic actors, and neither of these categories of solutions involve changing the fundamental structure of the situation. Solutions that do involve changing the rules of the game are [called] structural solutions.”

The motivation of not completely egoistic actors to cooperate is influenced by social value orientation, communication, and group identity. The social value orientation of a person seems to be acquired from the person’s social environment and is some linear combination of a cooperator who tries to maximize joint outcome, a competitor who tries to maximize own outcome relative to partner, and an individualist who tries to maximize own outcome. Kollock does not find any conclusive results in how to influence social value orientation but does find evidence that it varies between different countries.

The presence of communication positively affects cooperation rates. Communication enables a person to find out about others’ choices, to make explicit commitments, to appeal to what is the moral thing to do, and most importantly, to create or reinforce a sense of group identity. The effect of group identity is in fact so strong that it can affect cooperation rates even in the absence of communication. In-group behavior of individuals frequently includes personal restraint and treating Prisoner’s Dilemma situations as Assurance Games. However, in-group behavior implies out-group behavior with the potential to cause severe social costs due to intergroup conflicts.

“[Strategic solutions] rely on the ability of [egoistic] actors to shape to shape the outcomes and hence behavior of other actors. For this reason, many of these strategic solutions are limited to repeated two-person dilemmas.” Axelrod (see The Evolution of Cooperation) identifies three requirements for strategic solutions: ongoing relationships between actors (i.e. all expect shared dilemmas in their future), ability to identify each other, and ability to keep track of the other’s past behavior.

The most successful strategy in iterative Prisoner’s Dilemma tournaments (everyone against everyone) that meet these requirements is Tit-for-Tat which starts out with cooperation and then matches the partner’s previous behavior. This strategy transforms a repeated Prisoner’s Dilemma into a repeated Assurance Game since the only long-term outcome of this strategy is either mutual cooperation or mutual defection (the two equilibria of the Assurance Game). Key aspects of successful strategies in repeated Prisoner’s Dilemma tournaments are (1) to realize that it is not a zero-sum game hence does not benefit from a competitive social orientation (“don’t be envious”), (2) to not defect first, (3) to reciprocate both cooperation and defection, and (4) to be predictable so that the partner clearly understands one's strategy. One important caveat is that repeated Prisoner’s Dilemma tournaments assume perfect communication. In real life where communication is often imperfect more generous or forgiving strategies can avoid accidental cycles of recrimination.

Recent evidence suggests that the strategy of choosing partners is more important than the strategy used within a dilemma. In a modified version of iterative Prisoner’s Dilemma tournament actors can exit current relationships and choose alternative partners. A very successful strategy in this environment is Out-for-Tat which exits a relationship as soon as the partner defects. A more forgiving version that gives a defecting partner a second chance is even more successful.

Strategies for N-person dilemmas involve grim triggers, social learning, and group reciprocity. In a “grim trigger” strategy an individual only cooperates if all other group members cooperate and defects as soon as one other group member defects. Social learning is the basis of a cognitively less taxing class of strategies that involves imitating other group members and look for thresholds in public good provisioning instead of calculating marginal rates of return or figuring out dominating strategies. Group identity increases cooperation rates because group members follow strategies that assume that all members share a strong expectation of group reciprocity (reciprocity within the group).

Structural solutions change the rules of the dilemma thereby changing or eliminating it. One approach is to reinforce prerequisites for strategic solutions by introducing long-term accountability (shadow of the future) that influences individual reputations. However, accountability and reputation are not sufficient to escape the Prisoner’s Dilemma’s equilibrium of mutual defection (in two- or N-person version) if the means to encourage cooperation are too weak (e.g. production function for public good too flat or too much effort required to reach provisioning point).

Many people seem to positively weigh others’ outcomes since cooperation increases significantly as the benefits to others from one’s cooperation increase. Cooperation levels are also higher if group members are asked to contribute to a non-divisible public good that only benefits the whole group, probably due to an increased sense of group identity (see group reciprocity).

Cooperation in N-person dilemmas increases if individual contributions have (or are perceived to have) a discernable effect, i.e. make an efficacious contribution. For public goods with step-level production function one can create a minimal subgroup that requires every member to contribute in order to reach the provisioning point or let two groups compete for contributions, turning an N-person Prisoner’s Dilemma into an N-person Chicken Game. Another example are "matching grants" or "adopting" an individual from a large group of benefactors.

Increasing group size makes defection more anonymous and increases the cost of organizing. However, research results on cooperation depending on group size alone are inconclusive. In the case of highly non-rival goods with a threshold production function a larger group is more likely to contain a "critical mass" of cooperating individuals. Diversity of group members' interests and resources encourages formation of critical mass.

A common structural strategy for N-person dilemmas is the creation of boundaries in an attempt to make public goods or commons more excludable. There are three main approaches: The first one is to institute an external authority or trusted leader to govern access to commons. This approach appears to be less preferable if other structural changes are possible. Establishing an external authority can raise severe problems of justice, enforcement, corruption, and scalability. The second approach is to break up commons into private parcels assuming that individuals will take better care of own property than common property. However, privatization does not work for non-divisible goods, raises the social question of who gets to own commons, does not prevent owners to routinely destroy their own property (“tragedy of enclosure”), and requires institutional support to enforce private property rights. A third approach is to locally regulate “access to and use of common property by those who actually use and have local knowledge of the resource.” One key characteristic of successful and long-lasting local regulations is clearly defined boundaries.

Sanctions are a structural method to encourage cooperation where the outcomes themselves of N-person dilemmas are too weak of a motivator. However, the implementation of sanctions can be very expensive. Local monitoring and sanctioning systems are more practical and less costly. Another way to reduce cost is to use a graduated system of sanctions with low-cost conflict resolution. A sanctioning system is itself a public good and therefore poses a second-order dilemma. Communities with a high level of trust readily cooperate in a first-order dilemma but cooperate less in a second-order dilemma hence are less willing to support a sanctioning system. The opposite is true for communities with a high level of distrust.