Instability of defection in the prisoner’s dilemma under best experienced payoff dynamics

32 Pages Posted: 7 May 2020 Last revised: 2 Jan 2021

See all articles by Srinivas Arigapudi

Srinivas Arigapudi

University of Wisconsin - Madison, Department of Economics, Students

Yuval Heller

Bar Ilan University

Igal Milchtaich

Bar-Ilan University - Department of Economics

Date Written: January 01, 2021

Abstract

We study population dynamics under which each revising agent tests each strategy k times, with each trial being against a newly drawn opponent, and chooses the strategy whose mean payoff was highest. When k = 1, defection is globally stable in the prisoner’s dilemma. By contrast, when k > 1 we show that there exists a globally stable state in which agents cooperate with probability between 28% and 50%. Next, we characterize stability of strict equilibria in general games. Our results demonstrate that the empirically-plausible case of k > 1 can yield qualitatively different predictions than the case of k = 1 that is commonly studied in the literature.

Keywords: learning, cooperation, best experienced payoff dynamics, sampling equilibrium, evolutionary stability.

JEL Classification: C72, C73

Suggested Citation

Arigapudi, Srinivas and Heller, Yuval and Milchtaich, Igal, Instability of defection in the prisoner’s dilemma under best experienced payoff dynamics (January 01, 2021). Journal of Economic Theory, Forthcoming, Available at SSRN: https://ssrn.com/abstract=3573341 or http://dx.doi.org/10.2139/ssrn.3573341

Srinivas Arigapudi

University of Wisconsin - Madison, Department of Economics, Students ( email )

Madison, WI
United States

Yuval Heller (Contact Author)

Bar Ilan University ( email )

Dept. of Economics, Building 504
Bar Ilan University
Ramat Gan, 5290002
Israel
+972 5252 82182 (Phone)

HOME PAGE: http://https://sites.google.com/site/yuval26/

Igal Milchtaich

Bar-Ilan University - Department of Economics ( email )

Ramat-Gan, 52900
Israel

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