Abstract
Repeated interactions can foster cooperation of rational and purely self-interested actors in social dilemmas. Given these effects, actors also have incentives to invest in the formation of relations that involve repeated interactions. This chapter provides results on conditions for equilibria that imply mutual cooperation (‘effects of repeated interactions’) and also imply that such relations with repeated interactions are established in the first place. The new feature is that the results cover a reasonably broad class of social dilemma games.
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Notes
- 1.
Voss (2020) is a sound discussion of various pros and cons of the RE model.
- 2.
I remember very well that Thomas and I, as students and studying together, encountered Taylor’s book first of all in a seminar taught by Hans J. Hummell in the second half of the 1970s—one of Hummell’s outstanding Wednesday afternoon seminars we regularly attended together over a period of several semesters. Hummell and Hartmut Esser were important academic teachers in sociology for both of us during our student days.
- 3.
We use ‘he’, ‘his’ for readability and without intending gender bias.
- 4.
We address core features of the game-theoretic model. See a textbook such as Rasmusen (1994) for details on game-theoretic concepts and assumptions that are employed in our analysis. Appendix A provides a summary of our notation and assumptions.
- 5.
Given our assumptions, two games G are played in each round \(\mathrm{2,3},\dots \) of \(\Gamma ^{{one - shot}}\), one involving actor 1, the other involving actor 2. We do not need to further specify in which sequence these two games are played per round.
- 6.
Given our cost sharing institutions, Γ has one subgame \(\Gamma ^{{repeated}}\) and three subgames \(\Gamma ^{{one}{\text -}{shot}}\).
- 7.
Recall that we interpret payoffs as cardinal utilities. Note, too, that the model includes discounting of future payoffs due to the probability that Γ might end and that we neglect negative time preferences. It would be no problem to include negative time preferences and results would remain robust.
- 8.
We assume a noncooperative game precisely because we wish to specify conditions such that rational actors will cooperate without external enforcement in social dilemmas, based exclusively on the embeddedness of the dilemma in a long-term relation.
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Acknowledgments
The chapter is part of a research line on which I am collaborating with Vincent Buskens and Vincenz Frey since quite some time and with much pleasure. Discussions with Vincent and Vincenz and their contributions, including comments on this chapter, are gratefully acknowledged. I can hardly claim that all remaining errors in the present chapter are exclusively mine. As the chapter makes clear, I likewise build on joint work with Thomas Voss in an early phase of our academic careers.
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Raub, W. (2021). Endogenizing Conditions for Cooperation of Rational Egoists. In: Krumpal, I., Raub, W., Tutić, A. (eds) Rationality in Social Science. Springer VS, Wiesbaden. https://doi.org/10.1007/978-3-658-33536-6_10
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