Instability of defection in the prisoner’s dilemma under best experienced payoff dynamics
32 Pages Posted: 7 May 2020 Last revised: 2 Jan 2021
Date Written: January 01, 2021
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: Suggested Citation