Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 26, 2023 erstellt
Description:
This paper studies the interaction of beliefs, payoff parameters, and the cooperation rate in the infinitely repeated prisoner's dilemma. We show formally that a player's belief about the probability of cooperation by their opponent moderates the effect of changes in the payoff parameters on cooperation. If beliefs are high, increasing the gain from unilateral defection has a large negative effect on cooperation, while increasing the loss from unilateral cooperation has a negligible effect. However, if beliefs are low, this relationship is reversed: increasing the gain has only a negligible effect, while increasing the loss has a large negative effect on cooperation. The negative effect of both payoff parameters on cooperation becomes even larger when the belief is a function of the payoff parameters