reputation

Why Is Reciprocity So Rare in Social Animals? A Protestant Appeal

One Sentence Summary:
Game theoretic explanations of the evolution of cooperation in humans and other animals relies on assumptions -- rational players should never cooperate, cooperative behavior is explained by direct or diffuse reciprocity, animals can do the mental bookkeeping necessary to reciprocate with multiple partners over time -- that are not always or often borne out by data, necessitating new conceptual tools.
Disciplines:
Biology
Cultural Evolution
Economics
Findings:
  • Partner markets, emotions, learning, reputation all strongly influence cooperation in social animals including humans, but are ignored by conventional game theory models of reciprocal altruism, indicating a need for new conceptual tools in evolutionary game theory.
  • Evolution does not design new mental tools for each problem, but modifies existing mechanisms.
Keywords:
tit-for-tat
reputation
reciprocity
prisoners dilemma
evolution
cultural evolution
cooperation
altruism
Author(s) / Editor(s):
Published in:
Genetic and Cultural Evolution of Cooperation, Peter Hammerstein, Ed., MIT Press in Cooperation with Dahlem University Press
Date:
2003
One Paragraph Summary:

Game theoretic explanations of cooperation involving tit-for-tat strategies and reciprocal altruism are not supported by a large body of evidence. Only a small number of animal examples have been found. Simple models of repeated games do not match the circumstances of evolutionary change. Partner switching and mobility counter the assumptions necessary for reciprocal altruism as a stable evolutionary mechanism. Reciprocity requires significant mental machinery – how do organisms determine whether the actions of others are intentionally or unintentionally cooperative or uncooperative? Alternative conceptual schemas such as partner markets – making it unprofitable for partners to switch – offer alternative conceptual schemas. Emotions may play a role in mediating complex interactions in which intentionality and reputation play a part.

When Push comes To Pull: The New Economy and Culture of Networking Technology

One Sentence Summary:
Information and communication technology innovation have begun to transform commercial business and social institutions from a "push" technology approach (hierarchical "center out"), to a "pull" technology approach (networked -based and decentralized). This poses new challenges to social, political, and educational systems that are largely designed to support "push" economies.
Disciplines:
Business
Law
History
Cultural Evolution
Technology
Economics
Political Science
Sociology
Findings:
  • We are living in an epochal period of transition bridging two very different types of economies and cultures. We are transitioning from a "push" economy: that tries to anticipate consumer demand, and then creates a standardized product, and "pushes the product into the market and culture, using standardized distribution channels and marketing. We are transitioning to a "pull" economy: open and flexible production platforms that use network technologies to coordinate many different entities from disparate regions.. "Pull" economies produce customized products and services that serve localized needs (demand-driven), usually in a rapid manner.
  • "Pull" networks tend to build the capabilities of their networked partners, by providing performance feedback and sharing best practices among the network participants. "Pull" platforms therefore tend to better employ the enthusiasm of all of the participants.
  • The "pull" phenomenon is not confined to business/online commerce. The spread of common use of internet technologies is finding "pull" techniques being applied in entertainment, social life, politics, education, and government.
  • "Pull" models are going to change the way that governments create policy as more companies gravitate toward them.
Keywords:
capitalism
communication
complexity
cooperation
cultural evolution
group forming networks
hierarchy
intellectual property
interdependence
networks
norms
open source
property rights
reciprocity
reputation
social capital
trust
Author(s) / Editor(s):
Published in:
The Aspen Institute
Date:
2006
One Paragraph Summary:

Over the past 25+ years, change that has usually originated with technological innovation has led to new products, services, and human behavior patterns. These changes are reflected in business and industry, and the way that people entertain, govern, educate, and socialize among themselves. The change is from a centralized, command and control, bureaucratic, broadcast way of organizing, that tries to anticipate and create demand, to a decentralized and highly networked system that shares information about overall network performance and best practices among it's network, and meets local and specialized needs.

One Page Summary:

This paper is a summary of an Aspen Institute sponsored in-depth roundtable session, written from the perspective of one informed conference observer (Bollier). The participants are leading thinkers in the many complex areas this paper covers (economics, systems theory, human behavior, human futures, information technology evolution, etc) and are listed on page 57. A selection of their key insights shared in the paper are listed below:

A "push" economy is geared towards mass production, anticipating consumer demand, and routing resources to the right place at the right time, to create standardized and mass produced products. By contrast, a "pull" economy is based on open, flexible production platforms that are used to orchestrate a broad range of resources. Instead of producing standardized products, "pull" model companies are demand-driven, and assemble products in customized ways that serve specialized or local needs, usually using "rapid" or "on the fly" processes.

Several global corporations are moving towards "pull" methods, and away from "push" models; ie., Toyota, Dell, Cisco, Li & Fung. These companies employ different variations of Value Network models, that share information about overall network performance and best practices for serving specialized needs, among hundreds or even thousands of partner companies that make up the network. This creates an intra-network knowledge commons. Some companies also work closely with Open Source Software projects, thereby expanding their "pull" network, and expanding their knowledge commons into a broader Open Commons via Open Source Software project contributions. Thus, "pull" business models also tend to be Network Value-Increasing, and Commons-based business models as well.

"Pull" models can also be platforms for creating "increasing returns dynamics." This is due to "pull" models being based around loose and flexible networks that are already configured to scale as growth occurs. So, growth does not incur the huge overhead costs in administration that "push" models must contend with. Pull platform key characteristics include modular and loosely-coupled networks, open channels that better harness the passion and commitment of innovation communities. "Pull" platforms also will tend to influence public policy with regards to education and innovation, as more companies tend to gravitate towards the "pull" models.

The areas where "push" models tend to succeed in business are in areas where people do not know what they want, and prefer to shop from pre-made selections (Ikea, Home Depot). However, there are even "pull" models to found here, in the form of user-driven innovation, such as mountain biking, extreme skiing, hot rodding, etc. In these pro-amateur niches, customers don't necessarily know what they want, but do want to be a participant in the "pull" network that creates the product.

How do you tax a product that is made in 23 different countries? "Pull" models are going to change the way that governments create policy as more companies gravitate toward them. This will influence laws about intellectual property, education, taxation and more.

"Pull" economies are not just centered around finding creative ways to "outsource/offshore jobs" away from one place and to the places where "labor" is "cheaper". Successful "pull" models have encouraged and aided "insourcing", where more jobs are created, for instance in the United States by "foreign sources (a total of 7 million cited by this paper), than are out sourced (a total of 600,000+ cited by this paper). This is because pull models seek out, not just the "cheapest" labor, but the best ways to add value to the production networks. So, they can scale to many participants around the world, regardless of local labor costs, to find the best participants needed for specific specialized productions.

The social dynamics of "pull" models are highly centered around creating relationships of trust, sharing knowledge, and close cooperation among network participants. In "pull" models, non-market value creation (tacit knowledge, intangible value) is generally steered towards a commons-based model. A commons is used as a "collective governance regime for managing shared resources sustainably and equitably." Many of these commons are made possible by networked information technologies (the internet).

Bollier suggests that "if online commons are going to be useful to business, companies will need to do more work to develop protocols for identity and reputation management". This is because the use of the commons is based around trust. It also due to the need for ways to measure qualitative value in intangible assets beyond money, like knowledge, individual performance and value multiplication, and network wide performance/value multiplication.

Roundtable participants also noted that "pull" models will pose challenges to current education regimes that are centered around training people to participate in "push" economies. One of the participants mentions that " Computers, software tools, and Internet resources make possible some radically new styles of learning. By using pull-based systems, students can function much like businesses in the pull environment: They can access resources they don't control and put themselves into flows of activity, rather than just building inventories of static, objectified "knowledge."

Towards Realistic Models for Evolution of Cooperation

One Sentence Summary:
The five major approaches to answering how cooperation emerges and becomes stable in nature (Group Selection, Kinship Theory, Direct Reciprocity, Indirect Reciprocity, and Social Learning) might be improved by not presuming asexual and non-overlapping generations, simultaneous-play for every interaction, dyadic interactions, mostly predetermined and mistake-free behavior, discrete actions (cooperate or defect), and the trivial role of social structure and social learning of individuals.
Disciplines:
Biology
Cultural Evolution
Sociology
Findings:
  • Observer-based reciprocity relaxes the requirement that each individual's likelihood of cooperating be known globally by introducing randomly selected observers. Even though interactions are only visible to these observers cooperation can still evolve showing "that cooperation may evolve through indirect reciprocity with or without global knowledge about agents' image scores."
  • Darwin's notion of the "survival of the fittest" does not specify what "fittest" refers to, and for good reason: the outcome of a behavior in each contingent situation determines its fitness. Different interpretations of "fittest" lead to different models for how natural selection works and therefore offer different explanations for the evolution of cooperation.
Keywords:
trust
reputation
reciprocity
evolution
cultural evolution
cooperation
competition
bioeconomy
altruism
agent-based model
Author(s) / Editor(s):
Published in:
MIT LCS Memorandum
Date:
2002
One Paragraph Summary:

Sociological and biological observations of humans and animals show that cooperation is an inherent part of human life and the life of many animals. This poses two questions: how do cooperative strategies become stable within evolution? And, how does cooperation emerge initially? Even though researchers have tried to answer these questions for at least a century, existing models do not fully explain why cooperation evolves. There are five major approaches: Group Selection, Kinship Theory, Direct Reciprocity, Indirect Reciprocity, and Social Learning. Each of these models explain only a few aspects of cooperation and might be improved by dropping some unrealistic assumptions: asexual and non-overlapping generations, simultaneous-play for every interaction, dyadic interactions, mostly predetermined and mistake-free behavior, discrete actions (cooperate or defect), and the trivial role of social structure and social learning of individuals.

The Evolution of Cooperation

One Sentence Summary:
"The objective of this enterprise is to develop a theory of cooperation that can be used to discover what is necessary for cooperation to emerge."
Disciplines:
Political Science
Sociology
Findings:
  • The emergence of cooperation can be seen as a consequence of agents pursuing their own interests. It is not necessary to assume that those agents are more honest, more generous, or more cooperative per se.
  • What makes it possible for cooperation to emerge is the fact that the agents might interact again. The choice made now of whether or not to cooperate will affect choices made in later interactions. This called the 'shadow of the future.' The shadow of the future can exist even when the participants are unaware of it, as is the case in biological cooperation (symbiosis).
  • No best rule exists independently of the strategy being used by others. Despite this fact, robust strategies, useful in many contexts, are possible.
  • The evolution of cooperation requires high levels of reciprocal interactions between agents. The absolute number of agents can be small as long as their interactions are numerous.
  • Communities of cooperation, once established, can protect themselves from 'invasion' by less cooperative strategies. "The gear wheels of social evolution have a ratchet."
  • The winning tit-for-tat strategy:
    1. Don't be envious. Don't compare your success to others, only to your own strategic possibilities, i.e. are you employing the best strategy you have?
    2. Don't be the first to defect. Cooperate as long as others are cooperating.
    3. Reciprocate both cooperation and defection. Enforcing the rules is as important as playing by them.
    4. Be transparent. In order for others to coordinate their choices with yours, they have to understand your behavior. Keep it simple and out in the open.
  • Ways to promote cooperation:
    1. Enlarge the shadow of the future. Increase the permanence of cooperative choices or the frequency of interactions.
    2. Change the payoffs. Make the long-term incentives to cooperate greater than the short-term incentives to defect.
    3. Socialize reciprocal cooperation as a norm. Teach people to cooperate first.
    4. Improve collective memory. Collective memory, or culture, is embedded in institutions. Provide access to collective memory.
  • The foundation of cooperation is the durability of the relationship, which allows agents to learn about each other in order to cooperate.
Keywords:
assurance game
agent-based model
communication
cooperation
norms
prisoners dilemma
reciprocity
reputation
security
tit-for-tat
trust
Author(s) / Editor(s):
Published in:
Basic Books
Date:
August 1, 1985
One Paragraph Summary:

Why do people (or other actors) cooperate? "The objective of this enterprise is to develop a theory of cooperation that can be used to discover what is necessary for cooperation to emerge." It uses the Prisoner's Dilemma as a framework for testing theories about balancing self-interest and competition.

One Page Summary:

Chapter 1, The Problem of Cooperation. Why do people (or other actors) cooperate? "The objective of this enterprise is to develop a theory of cooperation that can be used to discover what is necessary for cooperation to emerge." It uses the Prisoner's Dilemma as a framework for testing theories about balancing self-interest and competition.

"In the Prisoners' Dilemma, the strategy that works best depends directly on what strategy the other player is using and, in particular, on whether this strategy leaves room for the development of mutual cooperation."

Chapter 2, TIT FOR TAT. "The iterated Prisoners' Dilemma has become the E. Coli of social psychology," yet people have not paid much attention to how to play the game well. Axelrod organized a computer tournament to which people familiar with PD submitted programs encoding different strategies. The winner was one of the simplest, TIT FOR TAT.

Axelrod then constructed an environment in which different programs competed, and the losing programs were eliminated: this was an ecology that rewarded high scoring programs, and punished others. "This process simulates survival of the fittest. A rule that is successful on average with the current distribution of rules in the population will become an even larger proportion of the environment of the other rules in the next generation. At first, a rule that is successful with all sorts of rules will proliferate, but later as the unsuccessful rules disappear, success requires good performance with other successful rules." In other words, the competition gets tougher.

"The analysis of the tournament results indicate that there is a lot to be learned about coping in an environment of mutual power. Even expert strategists from political science, sociology, economics, psychology, and mathematics made the systematic errors of being too competitive for their own good, not being forgiving enough, and being too pessimistic about the responsiveness of the other side."

The tournaments reveal that "there is a single property which distinguishes the relatively high-scoring entries from the relatively low-scoring entries. This is the property of being nice, which is to say never being the first to defect."

TIT FOR TAT's rules for success:

  • Be nice. Don't be the first to go on the attack. This demonstrates good will, and avoids provoking others.
  • Retaliate. If others attack, retaliate. Not doing so encourages bad behavior and gives niceness a bad reputation.
  • Be forgiving. If others defect but then go back to cooperating, accept the opportunity to move back to a cooperative mode.
  • Be clear. Others can predict what you'll do, be certain that their moves will have definite outcomes. "There is an important contrast between a zero-sum game like chess and a non-zero-sum game like the iterated PD. In chess, it is useful to keep the other player guessing about your intentions. The more the other player is in doubt, the less efficient will be his or her strategy. But in a non-zero-sum setting it does not always pay to be so clever. In the iterate PD, you benefit from the other player's cooperation."

Chapter 4, Trench Warfare. During World War I, "live and let live" arrangements emerged spontaneously between opposing units on the Western Front. Cooperation could take hold because "the same small units faced each other in immobile sectors for extended periods of time." Consequently, they had a more sustained relationship than in mobile warfare, and could develop commonly-understood rules, reciprocity and restraint in attacks, displays of strength (e.g., snipers shooting at hard targets)as well as ethics (recognition that there was an arrangement and violating it was immoral) and rituals (e.g., regular artillery firing).

"Cooperation first emerged spontaneously in a variety of contexts, such as restraint in attacking the distribution of enemy rations, a pause during the first Christmas in the trenches, and a slow resumption of fighting after bad weather made sustained combat almost impossible. These restraints quickly evolved into clear patterns of mutually understood behavior, such as two-for-one or three-for-one retaliation for actions that were taken to be unacceptable."

Chapter 6, How to Choose Effectively. Four suggestions about how to do well in PD:

  • Don't be envious. In a PD, "envy is self-destructive. Asking how well you are doing compared to how well the other player is doing is not a good standard unless your goal is to destroy the other player." However, in an iterated prisoner's dilemma, you can't do better than the other player, unless they're always suckers. "In a non-zero-sum world you do not have to do better than the other player to do well for yourself. The other's success is virtually a prerequisite of your doing well for yourself."
  • Don't be the first to defect (be nice). "It pays to cooperate as long as the other player is cooperating." In a short game, defection can make sense; but in a relationship, taking advantage of the other person is self-defeating.
  • Reciprocate both cooperation and defection. TIT FOR TAT "does not destroy the basis of its own success. On the contrary, it thrives on interactions with other successful rules." However, the right level of forgiveness depends on the context, and the other players' strategies.
  • Don't be too clever. "In a zero-sum game, such as chess it pays for us to be as sophisticated and as complex in our analysis as we can. Non-zero-sum games are not like this. The other player can respond to your own choices. And unlike the chess opponent, the other player in a PD should not be regarded as someone who is out to defeat you." "There is an important contrast between a zero-sum game like chess and a non-zero-sum game like the iterated PD. In chess, it is useful to keep the other player guessing about your intentions. The more the other player is in doubt, the less efficient will be his or her strategy. But in a non-zero-sum setting it does not always pay to be so clever. In the iterate PD, you benefit from the other player's cooperation."

Chapter 7, How to Promote Cooperation. Promoting cooperation can be thought of as an exercise in tinkering with the variables in a PD. "As long as the interaction is not iterated, cooperation is very difficult. That is why an important way to promote cooperation is to arrange that the same two individuals will meet each other again, be able to recognize each other from the past, and to recall how the other has behaved until now."

  • Enlarge the shadow of the future. For cooperation to emerge, players must be in a continuing relationship, with the expectation that it will continue in the future. "Mutual cooperation can be stable if the future is sufficiently important relative to the past." "There are two basic ways of doing this: by making the interactions more durable, and by making them more frequent. [P]rolonged interaction allows patterns of cooperation which are based on reciprocity to be worth trying and allows them to become established," Making interactions more frequent makes "the next interaction occur sooner, and hence the next move looms larger than it otherwise would." You might do this by enforcing isolation, or constructing hierarchies or organizations, which are "especially effective at concentrating the interactions between specific individuals."
  • Change the payoffs. Make defection less attractive, by enforcing laws, or growing the value of long-term incentives.
  • Teach people to care about each other.
  • Teach reciprocity. Reciprocity "actually helps not only oneself, but others as well. It helps others by making it hard for exploitative strategies to survive."
  • Improve recognition abilities. "The ability to recognize the other player from past interactions, and to remember the relevant features of those interactions, is necessary to sustain cooperation. Without these abilities, a player could not use any form of reciprocity and hence could not encourage the other to cooperate."

Chapter 8, The Social Structure of Cooperation.
The social structure of cooperation involves labels, reputation, regulation, and territoriality.

  • Labels are fixed characteristics of an agent that are observable by other agents. Labels affect reciprocity and retaliation via assumptions of group similarity and stereotypes.
  • Reputation is others' belief about the strategies an agent will employ. Reputation may be based on past behavior or on rumours, i.e. reputation can be accurate or merely believed. Reputation affects whether or not other agents will cooperate or defect with you.
  • Regulation involves setting the stringency of a standard of behavior "high enough to get most of the social benefits of regulation, and not so high as to prevent the evolution of a stable pattern of voluntary compliance from almost all of the companies" (or regulated agents).
  • Territoriality refers to both physical and conceptual spaces that can be 'invaded' by agents of differing strategies. Territoriality establishes boundaries within which behaviors will be reinforced or retaliated against depending on prevailing norms. Also, the boundary provides an 'inside' for agents that comply with the norms, and an 'outside' to which they can be expelled if they do not comply.

Chapter 9, The Robustness of Reciprocity.

  • Cooperation can get started by even a small cluster of individuals who are willing to reciprocate cooperation, even in a world where no one else will cooperate.
  • Once cooperation is establish, it protects itself from invasion by non-cooperative strategies.
  • The foundation of cooperation is the durability of the relationship, which allows agents to learn about each other in order to cooperate.

Is Strong Reciprocity a Maladaptation? On the Evolutionary Foundations of Human Altruism.

One Sentence Summary:
Evidence is cited that strong reciprocity (repaying cooperation and punishing defection, cheating, violation of fairness norms), which plays a role in the provision of public goods and contradicts theories of selfish actors, is neither a maladaptation, nor explained in an evolutionary context by kin selection, reciprocal altruism, indirect reciprocity, or costly signaling.
Disciplines:
Biology
Cultural Evolution
Computer Science
Political Science
Sociology
Findings:
  • Humans repay gifts and punish cheaters of cooperation and fairness norms, even in anonymous, one-shot encounters with genetically unrelated strangers (strong reciprocity) – contrary to theories that all humans are strictly rational and strictly self-interested actors -- and evidence suggests that the presence of a high number of strong reciprocators in human groups was an evolutionary advantage.
  • Strong reciprocity plays a decisive role in the production of public goods – strong reciprocity in the provision of public goods is enabled by the metanorm of altruistic punishment, which makes possible the maintenance of norms that are good for groups at a cost to individuals.
Keywords:
altruism
cooperation
evolution
prisoners dilemma
public goods
punishment
reciprocity
reputation
tit-for-tat
Author(s) / Editor(s):
Published in:
MIT Press in Cooperation with Dahlem University Press
Date:
2003
One Paragraph Summary:

Economic games that probe of human behavior (including games that allow punishment of cheaters and non-reciprocators), together with research by biologists, zoologists, and primatologists have delivered strong evidence that traditional assumptions of universally strictly egoistic (rationally self-interested) behavior are at least partially wrong: People repay gifts and punish cheaters, even at a cost to themselves, even among strangers in one-shot games where there is not possibility of reaping future repayment. This practice of "strong reciprocity" has been explained evolutionarily as a maladaptation. The authors of this survey marshal evidence that theories of kin selection (altruism on behalf of genetic relatives that provides reproductive advantage to those who share the altruist's genes), reciprocal altruism (gifts that are made with expectation of eventual repayment by the giftee), indirect reciprocity (gaining a reputation that could pay off in future encounters with other members of the group) costly signaling (acts that cost the actor, but which signal desirability of the signaler as a potential ally or mate) do not sufficiently explain strong reciprocity – and evidence that contradicts these theories as explanatory mechanisms. A cultural evolution hypothesis is proposed: groups that are not closely genetically related can gain survival advantage in competition with other groups if a disproportionate number of strong reciprocators are present – and the presence of strong reciprocators is only possible when cheaters are punished. At the same time, other selection pressures drive the presence of purely selfish humans. Both types coexist because they have coevolved in human cultural practice. The authors offer a beginning, not an ultimate answer, to questions about strong reciprocity, suggesting further research.

Foundations of Human Sociality (Introduction and Overview)

One Sentence Summary:
Experiments like the Ultimatum Game and the Public Goods Game (one shot games for real money divided among strangers) that have been conducted in different countries all over the world have shown that group behavior frequently does not fit the traditional model of self-interested actors, that it is too richly varied between cultures to support a universal sense of fairness, and that a higher degree of market integration and higher payoffs to cooperation can be linked to greater levels of prosocial behavior.
Disciplines:
Economics
Sociology
Psychology
Findings:
  • People are willing to reward fairness and reciprocity and punish those who do not act pro-socially, even at cost to themselves.
  • Group-level differences in behavior proved to be greater than individual-level differences, indicating cooperative behavior might be more embedded in cultural conditions than was previously thought. While one culture might take advantage of a person who is too altruistic, another might exclude a person for being too self-interested.
Keywords:
trust
reputation
reciprocity
public goods
prisoners dilemma
game theory
equilibrium
cultural evolution
cooperation
communication
assurance game
altruism
Published in:
Oxford University Press
Date:
2004
One Paragraph Summary:

The self-regarding and outcome oriented picture of human behavior presented in traditional economics does not explain why humans care so much about each other and about how social interaction is carried out, not just the end goals. The Ultimatum Game, designed by Werner Guth, is just one illustration of how real people will not always follow the dictates of self-interested rationality. Two subjects are given a sum of money, one is given the power to divide the sum, and the other can either accept or reject (in which case neither get any money). Research from conducting hundreds of trials of the game with thousands of students in Europe, Japan and the USA has shown that the responders frequently reject low offers and proposers frequently propose near equal divisions, even though it is to their monetary disadvantage. While early experiments on undergraduates seemed to suggest that there was a universal sense of fairness, extended research in different cultures (hunter-gatherers, slash-and-burn agriculturists, nomadic pastoralists) has exposed much cultural variation in responses, indicating that local cultural conditions play an important role in how people approach cooperation.

One Page Summary:

The self-regarding and outcome oriented picture of human behavior presented in traditional economics does not explain why humans care so much about each other and about how social interaction is carried out, not just the end goals. The Ultimatum Game, designed by Werner Guth, is just one illustration of how real people will not always follow the dictates of self-interested rationality. Two subjects are given a sum of money, one is given the power to divide the sum, and the other can either accept or reject (in which case neither get any money). Research from conducting hundreds of trials of the game with thousands of students in Europe, Japan and the USA has shown that the responders frequently reject low offers and proposers frequently propose near equal divisions, even though it is to their monetary disadvantage. While early experiments on undergraduates seemed to suggest that there was a universal sense of fairness, extended research in different cultures (hunter-gatherers, slash-and-burn agriculturists, nomadic pastoralists) has exposed much cultural variation in responses, indicating that local cultural conditions play an important role in how people approach cooperation.

While mean proposals for university students from all over the world was usually between 42 and 48 percent, mean proposals from this cross-cultural study varied from 25 to 57 percent. Rejection rates, the action of the responders, also varied considerable between groups. Individual-level economic and demographic variables did not explain behavior as well as group-level behavior, and game play often could be connected to the people's common patterns of interaction. For example, the Orma recognized that one of the experiment's games was similar to the harambee, a local institution of giving to public goods like roads and schools. They began calling it 'the harambee game' and displayed highly prosocial behavior. In other groups, like the Au and Gnau, frequent rejection of generous offers can be explained by a cultural association with gift-giving: accumulating gifts, even if unsolicited, can imply a lowered status and force the receiver into future obligations or political alliance. The cross-cultural study showed that, in the case of groups at the extremes of behavior, "contrasting behaviors seem to reflect their differing patterns of everyday life, not any underlying logic of hunter-gatherer life ways."

The effect of market integration on cooperation to obtain a monetary reward can be explained easily: individuals from market-oriented societies when put in the context of one of the games are able to seek analogues in their daily activities of using and trading money with strangers. "Those who do not customarily deal with strangers in mutually advantageous ways may be more likely to treat anonymous interactions as hostile or threatening, or as occasions for the opportunistic pursuit of self-interest."

Factors Influencing Cooperation in Commons Dilemmas: A Review of Experimental Psychological Research

One Sentence Summary:
While much of the economic research of commons dilemmas has explored the big-picture effects of rules, institutions, and payoff structures on cooperative behavior, experimental psychological research has uncovered crucial factors of its own, suggesting that the best commons institutions of the future will seek the best fit between top-down institutional rules and the bottom-up individual psychological effects.
Disciplines:
Psychology
Findings:
  • Many perceptual factors of the commons situation had significant influence over the choice behavior of individuals. Differences in the form of power and status of administrative parties, for example, may dictate the effectiveness of rewards and punishments. Managers of a chemical plant, given the option of short-term monetary advantage (waste storage) versus long-term environmental advantage (waste treatment), were more likely to choose the long-term option if the rewards and punishment came from the parent corporation rather than from the government.
Keywords:
altruism
communication
cooperation
emotion
norms
reputation
trust
Published in:
National Academy Press
Date:
2002
One Paragraph Summary:

Social psychological research has a long tradition of interest in cooperative behavior and commons dilemmas, beginning with Von Neumann and Morgenstern's 1944 book, Theory of Games and Economic Behavior. It is convenient to summarize the way psychological studies have attacked the commons problem through nine variables (social motives, gender, payoff structure, uncertainty, power, status, group size, communication, causes, frames) divided into three groups (individual differences, situational factors of the task structure, and the perceived effects of situational factors.) Although behavior elicited in a controlled lab environment is never the same as that observed in field research, lab research is an indispensable tool for teasing out causal relations from the larger number of interacting influences. Attention to the findings of psychological research relevant to the specific instance of a commons dilemma can make the difference in generating positive collective action.

One Page Summary:

Social psychological research has a long tradition of interest in cooperative behavior and commons dilemmas, beginning with Von Neumann and Morgenstern's 1944 book, Theory of Games and Economic Behavior. It is convenient to summarize the way psychological studies have attacked the commons problem through nine variables (social motives, gender, payoff structure, uncertainty, power, status, group size, communication, causes, frames) divided into three groups (individual differences, situational factors of the task structure, and the perceived effects of situational factors.) Although behavior elicited in a controlled lab environment is never the same as that observed in field research, lab research is an indispensable tool for teasing out causal relations from the larger number of interacting influences. Attention to the findings of psychological research relevant to the specific instance of a commons dilemma can make the difference in generating positive collective action.

Studies on social motives have found correlations between motives and choice behavior and interpretation of others' behavior. Liebrand et al. (1986) demonstrated that "people with individualist social motives tend to interpret behavior along the might dimension (what works), whereas cooperators tend to view cooperation and competition as varying on the moral dimension (what is good or bad)." Less intuitive findings have come out of research into social rewards for cooperative behavior. Gachter and Fehr (1999) conducted a study around public goods dilemmas with an anonymous group, a group that met beforehand to establish a group identity, a group that had a chance to interact after playing, and a group that met before and after. They found that neither the second nor the third groups had significant improvements in cooperation, but that the fourth option resulted in "significantly higher levels of contribution."

Uncertainty of resource size may play a detrimental role in commons dilemmas for multiple reasons. Any factor which threatens to bring an end to the resource will decrease interest in one's reputation and therefore with the relations that support the resource's maintenance. Uncertainty also helps diffuse personal responsibility, since overusers can try to justify their actions through their ignorance of the current resource size.

Experimenters have also uncovered interesting effects from varying groups size on self-efficacy, an individual's sense of their own competence in taking effective action. Smaller groups were found by Kerr (1989) to have higher averages when testing "collective" efficacy, the sense that the group could carry out effective actions to achieve a desired outcome. In groups with a relatively low provision point, the percentage of cooperating members necessary to support the public good, small group size was associated with a sense of "collective" efficacy.

Voting can significantly improve efficiencies in commons dilemmas by acting as a form of communication. Collective learning of general information "extends to subsequent situations and enables people to coordinate their activities even in rounds when no proposals are made."

Evolution of Indirect Reciprocity

One Sentence Summary:
Cooperation through indirect reciprocity, captured by the phrase "I help you, someone else helps me", requires the evolution of reputations and communication of those reputations among the larger group (as in the human instinct to gossip), cognitive abilities beyond being able to identify relatives (required for kin selection) or the individuals who have cooperated with you in the past (required for direct reciprocity).
Disciplines:
Economics
Sociology
Psychology
Findings:
  • "The hypothesis that more information leads to more cooperation has been confirmed in experiments, which compare three information conditions. In one condition, players have no information about their co-players; in the second they are told about what their co-players have decided when last in the role of a donor; and in the third they also know about the score of the recipient of the co-player. We note that this is not always enough to decide whether a previous defection was justified or not. However, the additional knowledge did enhance cooperation."
  • "Indirect reciprocity is situated somewhere between direct reciprocity and public goods. On the one hand it is a game between two players only, the donor and the recipient, but on the other hand it has to be played within a larger group. Richard Alexander claimed that indirect reciprocity originates from direct reciprocity in the presence of interested audiences."
  • "It is easy to conceive that an organism experiences as 'good' or 'bad' anything that affects the organism's own reproductive fitness in a positive or negative sense. The step from there to judging, as 'good' or 'bad', actions between third parties, is not obvious. The same terms 'good' and 'bad' that are applied to pleasure and pain are also used for moral judgements: this linguistic quirk reveals an astonishing degree of empathy, and reflects highly developed faculties for cognition and abstraction."
  • Even a group of players with discriminating strategies can be sidetracked by imperfect transfer of reputation information, as in unfounded rumors or exaggeration: "if players have different views about the reputation of others, then errors in perception can undermine cooperation."
  • In empirical studies, discriminating players are sensitive to their own score: "players who justifiably refuse to donate to a defector show an increased tendency to provide donations in the following round, as if to make up for that refusal. This indicates that they expect their refusal to lower their score in the co-players' eyes and that they do not rely on the community's understanding."
Keywords:
agent-based model
altruism
assurance game
communication
cooperation
equilibrium
game theory
language
norms
prisoners dilemma
public goods
punishment
reciprocity
reputation
tit-for-tat
trust
Author(s) / Editor(s):
Published in:
Nature 437, 1291-1298
Date:
October 27, 2005
One Paragraph Summary:

Cooperation through indirect reciprocity, can be captured by the phrase "I help you, someone else helps me". Indirect reciprocity helps explain how cooperation is possible at all when economic transactions move beyond small villages where one can easily keep track of one's interactions with everyone else. The success of strategies of indirect reciprocity in empirical studies might be attributable to the fact that humans care so deeply not only about how they are treated, but about the results of interactions between third parties. This concern and the desire to communicate concerns, or gossip, might in turn be explained by evolutionary psychology and the benefits of cooperation in large groups, surpluses resulting from division of labor. To test strategies of indirect reciprocity no two players can interact more than once and the scores of players (the portion of times they have cooperated with others) must be visible. A player choosing a simple version of indirect reciprocity will only cooperate with those whose score is above a certain threshold. However, this player might be punishing another player using indirect reciprocity who has only interacted with defectors. "Effectively, discriminating players pay a cost for punishing bad co-players. Such a form of altruistic punishment can promote cooperation in the community, but at a cost to the punisher, and thus can be viewed as a social dilemma." A more sophisticated strategy would have a player discriminate between justified defection (defecting to punish someone who always defects) and unjustified defection (defecting regardless of the recipients reputation). This strategy avoids the case where a group of players who always cooperate is invaded by a group of players who always defect, but it requires the cognitive abilities to keep track of interactions that are far removed from one's own.

Coalitional Effects on Reciprical Fairness in the Ultimatum Game: A Case from the Ecuadorian Amazon

One Sentence Summary:
Patton attributes differences between two Ecuadorian ethnic/political groups in their willingness to cooperate in the Ultimatum Game to the groups' "differences in coalitional stability, perceptions of trust, and needs to maintain reputation," and emphasizes properties of the groups' political environment over individual differences.
Disciplines:
Anthropology
Political Science
Findings:
  • Market integration in nonwesternized cultures might have had a negative impact on cooperation by introducing unequal access to goods and conflict between western institutions and local nonhierarchical structures. The more market-integrated group (and the one described as more cooperative), the Quichua, proposed significantly smaller divisions compared to the Achuar. This poses a counterexample to a hypothesis presented in the Overview to this book, that market integration means frequent interactions and a familiarization with the process of cooperating with strangers, which translates into cooperation in the Ultimatum Game.
  • The most important factor in cooperation during the game was group coalition strength, over the much less significant or near significant factors of sex, age, and social status. Alarmingly high homicide rates among males in the area magnify the importance of coalition strength. "Coalitional instability undermines one's ability to condition future play, and discounts the benefits derived from investing in the creation and maintenance of a reputation as a fair player."
  • Longstanding habits of reciprocal fairness that flourish in politically stable environments overrode factors that would otherwise tempt self-interested behavior, such as the anonymous and one-shot properties of this Ultimatum Game.
Keywords:
reciprocity
game theory
cooperation
capitalism
assurance game
altruism
reputation
social capital
trust
Author(s) / Editor(s):
Published in:
Oxford University Press
Date:
2004
One Paragraph Summary:

This study examined patterns of cooperative behavior of two ethnic/political groups in Conambo of the Ecuadorian Amazon, the Achuar and the Quichua, with the Ultimatum Game. The participants were randomly divided into proposers and responders. Proposers were told to divide 20 coins worth a total of a days labor (approximately $3.85) into two piles, one for them and one for the responders. The proposer then left the room and a responder was brought in, not knowing the identity of their proposer, and asked to accept or reject the division (rejection of the division entailed no money for either participant, aside from the 5 coins given to all at the start for their time). A successive pile technique was used to determine the alliance strength of all participants. Informants were asked to divide photographs of the participants according to who would be most reliable in maintaining a coalition during a conflict. The researchers found that proposers with higher average alliance strength gave more generous offers and that the Achuar, with higher average alliance strength, had an average proposal of 42.9 percent, while the Quichua, with lower average alliance strength, had an average proposal of 24.6 percent. "The relationship between average alliance strength and amounts offered appears to be a group effect rather than an individual effect."

An Evolutionary Approach to Norms

One Sentence Summary:
Exploration of games in which punishment is possible and cheating is not automatically detected reveals that norms can emerge and stabilize only if those who fail to punish violators are also punished.
Disciplines:
Biology
Computer Science
Economics
Political Science
Findings:
  • Norms can emerge in competitive situations when players can observe each other and imitate the strategies of successful players.
  • N-person Prisoner's Dilemma games can't be resolved with simple reciprocity without enabling cooperators to also punish defectors.
  • Norms can emerge and grow stable if metanorms establish a willingness to not only punish violators but also those who fail to punish violators.
  • Norms likely emerge from behaviors that signal others to reward individuals (reputation), and spread through both imitation as well as punishment of violators.
  • "There may be some useful cooperative norms that could be hurried along with relatively modest interventions."
Keywords:
reputation
cooperation
evolution
norms
game theory
agent-based model
cultural evolution
complexity
competition
prisoners dilemma
altruism
Author(s) / Editor(s):
Published in:
American Political Science Review 80, No. 41095-1111
Date:
1997
One Paragraph Summary:

The decrease in punishment of those who failed to punish violators may have played a part in the sudden collapse of communism, and Granovetter noted that riots can have tipping points in which "a slight change in the willingness of a few people to act first can get the ball rolling." Axelrod defines norms thus: "A norm exists in a given social setting to the extent that individuals usually act in a certain way and are often punished when seen not to be acting in this way." Therefore, norms are a matter of degree, not all or nothing. "By linking vengefulness against nonpunishers with vengefulness against defectors, the metanorm provides a mechanism by which the norm against defection becomes self-policing." Reputation plays a role because defection is not only a means for a defector to harvest a payoff, but a signal that can be used be others: "a norm is likely to originate in a type of behavior that signals things about individuals that will lead others to reward them." The observation from norms-game trials that norms can sometimes establish themselves quickly led Axelrod to conclude that "there may be some useful cooperative norms that could be hurried along with relatively modest interventions."

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