House Oversight — Estate records
HOUSE_OVERSIGHT_026521
CWOL
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Cooperating Without Looking Moshe Hoffman, 1,2∗† Erez Yoeli, 2,3∗ Martin Nowak 2 1 Department of Computer Science and Engineering, University of California at San Diego, La Jolla, CA 92093 2 Program for Evolutionary Dynamics, Harvard University, Cambridge, MA 02138 2 Federal Trade Commission, 600 Pennsylvania Ave. NW, Washington, DC 20004 ∗ These authors contributed equally to this work. † To whom correspondence should be addressed; E-mail: hoffman.moshe@gmail.com. Cooperation occurs when we take on costs to help others. A key mechanism by which cooperation is sustained is reciprocity: individuals cooperate with those who have cooperated in the past. In reality, we not only condition on others’ past cooperative actions, but also on the decision making process that leads to cooperation: we trust more those who cooperate without calculating the costs because they will cooperate even when those costs are high. We propose a game theory model to explain this phenomenon. In our model, player 1 chooses whether or not to cooperate with player 2. Player 1 faces a stochastic temptation to defect and, before choosing whether to cooperate, also decides whether to “look” at the realized temptation. Player 2 observes not only whether player 1 ultimately cooperated but also whether she looked, then decides 1 whether or not to continue interacting with player 1. We find conditions in which there is an equilibrium where player 2 chooses to interact with player 1 only if player 1 cooperates without looking (CWOL) and player 1 chooses to CWOL. We show that this equilibrium is robust to both high degrees of rationality, as modeled by subgame perfection and learning or evolutionary dynamics, as modeled by the replicator dynamic. Using computer simulations, we also show that it emerges with high frequency, even in the presence of other equilibria. Additionally, we show that the ability for player 1 to avoid looking, and the ability for player 2 to detect looking increases cooperation. W […]