Cooperation among Strangers under the Shadow of the Future
American Economic Review · 2009 · Volume 99 · Issue 3
Abstract
We study the emergence of norms of cooperation in experimental economies populated by strangers interacting indefinitely. Can these economies achieve full efficiency even without formal enforcement institutions? Which institutions for monitoring and enforcement facilitate cooperation? Finally, what classes of strategies do subjects employ? We find that, first, cooperation can be sustained even in anonymous settings; second, some type of monitoring and punishment institutions significantly promote cooperation; and, third, subjects mostly employ strategies that are selective in punishment. (JEL C71, C73, D12, Z13)
Keywords
Cooperative Games, Stochastic and Dynamic Games, Evolutionary Games, Repeated Games, Consumer Economics: Empirical Analysis, Economic Sociology, Economic Anthropology
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