Benefits of tolerance in public goods games

Leaving the joint enterprise when defection is unveiled is always a viable option to avoid being exploited. Although loner strategy helps the population not to be trapped into the tragedy of the commons state, it could offer only a modest income for non-participants. In this paper we demonstrate that showing some tolerance toward defectors could not only save cooperation in harsh environments, but in fact results in a surprisingly high average payoff for group members in public goods games. Phase diagrams and the underlying spatial patterns reveal the high complexity of evolving states where cyclic dominant strategies or two-strategy alliances can characterize the final state of evolution. We identify microscopic mechanisms which are responsible for the superiority of global solutions containing tolerant players. This phenomenon is robust and can be observed both in well-mixed and in structured populations highlighting the importance of tolerance in our everyday life.Comment: 10 two-column pages, 8 figures; accepted for publication in Physical Review

Shedding Light into Preference Heterogeneity: Why Players of Traveller’s Dilemma Depart from Individual Rationality?

We analyse the experimental outcome of the Traveller's Dilemma under three different treatments - baseline (BT), compulsory ex post players' meeting (CET) and voluntary ex post players' meeting (VET) - to evaluate the effects of removal of anonymity (without preplay communication) in a typical one shot game in which there is a dilemma between individual rationality and aggregate outcome. We show that deviations from the Nash equilibrium outcome are compatible with the joint presence in the sample of individually rational, team-rational, (gift giving), "irrational" and (opportunistic) "one-shot-cooperator" types. The two main factors affecting deviations from the standard individually rational behaviour are male gender and the interaction of generalised trust with the decision of meeting the counterpart in the VET design.Traveller’s Dilemma, Team Preferences, Social Distance, Generalised Trust, Relational Goods

Enhancement and Civic Virtue

Opponents of biomedical enhancement frequently adopt what Allen Buchanan has called the “Personal Goods Assumption.” On this assumption, the benefits of biomedical enhancement will accrue primarily to those individuals who undergo enhancements, not to wider society. Buchanan has argued that biomedical enhancements might in fact have substantial social benefits by increasing productivity. We outline another way in which enhancements might benefit wider society: by augmenting civic virtue and thus improving the functioning of our political communities. We thus directly confront critics of biomedical enhancement who argue that it will lead to a loss of social cohesion and a breakdown in political lif

Cooperation Enforcement and Collusion Resistance in Repeated Public Goods Games

Enforcing cooperation among substantial agents is one of the main objectives for multi-agent systems. However, due to the existence of inherent social dilemmas in many scenarios, the free-rider problem may arise during agents' long-run interactions and things become even severer when self-interested agents work in collusion with each other to get extra benefits. It is commonly accepted that in such social dilemmas, there exists no simple strategy for an agent whereby she can simultaneously manipulate on the utility of each of her opponents and further promote mutual cooperation among all agents. Here, we show that such strategies do exist. Under the conventional repeated public goods game, we novelly identify them and find that, when confronted with such strategies, a single opponent can maximize his utility only via global cooperation and any colluding alliance cannot get the upper hand. Since a full cooperation is individually optimal for any single opponent, a stable cooperation among all players can be achieved. Moreover, we experimentally show that these strategies can still promote cooperation even when the opponents are both self-learning and collusive

Cities and Cultures

We investigate the existence of wage premium due to cultural diversity across US cities. Using census data from 1970 to 1990, we find that at the urban level richer diversity is systematically associated with higher average nominal wages for white US-born males. We measure cultural diversity in a city using the variety of languages spoken by city-residents. While the positive correlation between wages and diversity survives a battery of robustness checks, it seems to be larger once foreign cultures have been assimilated. Finally, instrumental variable estimation hints at causation going from diversity to wages. Comparing real and nominal wages across cities, we interpret these results as evidence that diversity enhances productivity.Cultural diversity, Productivity, Wages, Metropolitan areas

International Climate Games: From Caps to Cooperation

Greenhouse gas abatement is a public good, so climate policy is a public-goods game and suffers from the free-rider incentives that make the outcome of such games notoriously uncooperative. Adopting an international agreement can change the nature of the game, reducing or exacerbating the uncooperative tendencies of the players. We analyze alternative international agreements as variations of the public-goods game, and examine the incentives for cooperation under each alternative. The addition of cap-and-trade rules to the basic public-goods game is found to polarize the free-rider incentives of that game, encouraging those who would abate the most to target even higher abatement levels and those who would abate the least to target lower, and even negative, abatement levels. Such polarization between developed and developing countries is familiar from both the Kyoto and Copenhagen climate summits. Since cap-and-trade rules decrease cooperation by developing countries, developed countries are led to reject the game’s outcome and in the process prevent agreement on a set of quantity targets. To break this deadlock and shift the equilibrium toward cooperation, a modification of the public-goods game based on price rather than quantities is needed. This involves a global price target and equity transfers via a Green Fund that rewards adoption of and compliance with such a target. The Nash equilibrium of one such game is analyzed for a group of three countries similar to the United States, China and India.global warming, climate change, climate treaty, cap and trade, carbon tax, carbon price, public goods