The Evolution of Cooperation among Other-Regarding Agents

By gjones, published at 4 September 2007 - 4:16am, last updated 9 years 33 weeks ago.

Sam Bowles and Herb Gintis have a new review of game theoretic models of cooperation which is to appear in The New Palgrave Dictionary of Economics, to be published next year. Bowles and Gintis begin with dyadic interactions among self-regarding agents showing that cooperation can be maintained with such mechanisms as retribution, where cooperation is withheld from previously defecting agents (tit-for-tat) and reputation maintenance, where "mental models" of previous cooperation behavior are important to overcome the problem of infrequent interactions with a large number of partners. Among others, the standing model of Sugden, the indirect reciprocity model of Panchanathan and Boyd and the image scoring model of Nowak and Sigmund are considered.

Next, they examine the Folk Theorem in large groups of self-regarding agents operating under imperfect information, observing that the intuitions of the dyadic model do not extend to contexts involving larger group size and higher error rates. Finally, they explore cooperation in large groups of other-regarding agents, asking "how such altruistic behavior could have become common, given that bearing costs to support the benefits of others reduces payoffs, and both cultural and genetic updating of behaviors is likely to favor traits with higher payoffs." Citing a number of recent studies, they conclude that cooperation can be sustained in groups of substantial size where agents with social preferences are more likely than random to interact with other agents with social preferences (an idea akin to Brian Skyrms' notion of correlated association). They further conclude that the long term evolution of such social preferences is plausible.

Newcomers to game theoretic models of cooperation would do well to start with this excellent review. An advance version of the paper is available here.

Samuel Bowles and Herbert Gintis, Cooperation, in the The New Palgrave Dictionary of Economics, Eds. L. Blume and S. Durlauf. MacMillan (forthcoming, 2008).