Time Horizon and Cooperation in Continuous Time

Bigoni, Maria ; Casari, Marco ; Skrzypacz, Andrzej ; Spagnolo, Giancarlo (2011) Time Horizon and Cooperation in Continuous Time. Bologna: Dipartimento di Scienze economiche DSE, p. 42. DOI 10.6092/unibo/amsacta/4442. In: Quaderni - Working Paper DSE (796). ISSN 2282-6483.
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Abstract

When subjects interact in continuous time, their ability to cooperate may dramatically increase. In an experiment, we study the impact of different time horizons on cooperation in (quasi) continuous time prisoner's dilemmas. We find that cooperation levels are similar or higher when the horizon is deterministic rather than stochastic. Moreover, a deterministic duration generates different aggregate patterns and individual strategies than a stochastic one. For instance, under a deterministic horizon subjects show high initial cooperation and a strong end-of-period reversal to defection. Moreover, they do not learn to apply backward induction but to postpone defection closer to the end.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Bigoni, Maria
Casari, Marco
Skrzypacz, Andrzej
Spagnolo, Giancarlo
Keywords
folk theorem, prisoner's dilemma, backward induction, termination rule, infinite horizon
Subjects
ISSN
2282-6483
DOI
Deposit date
25 Jan 2016 15:47
Last modified
25 Jan 2016 15:47
URI

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