The Viability of Cooperation Based on Interpersonal Commitment

A prominent explanation of cooperation in repeated exchange is reciprocity (e.g. Axelrod, 1984). However, empirical studies indicate that exchange partners are often much less intent on keeping the books balanced than Axelrod suggested. In particular, there is evidence for commitment behavior, indicating that people tend to build long-term cooperative relationships characterised by largely unconditional cooperation, and are inclined to hold on to them even when this appears to contradict self-interest. Using an agent-based computational model, we examine whether in a competitive environment commitment can be a more successful strategy than reciprocity. We move beyond previous computational models by proposing a method that allows to systematically explore an infinite space of possible exchange strategies. We use this method to carry out two sets of simulation experiments designed to assess the viability of commitment against a large set of potential competitors. In the first experiment, we find that although unconditional cooperation makes strategies vulnerable to exploitation, a strategy of commitment benefits more from being more unconditionally cooperative. The second experiment shows that tolerance improves the performance of reciprocity strategies but does not make them more successful than commitment. To explicate the underlying mechanism, we also study the spontaneous formation of exchange network structures in the simulated populations. It turns out that commitment strategies benefit from efficient networking: they spontaneously create a structure of exchange relations that ensures efficient division of labor. The problem with stricter reciprocity strategies is that they tend to spread interaction requests randomly across the population, to keep relations in balance. During times of great scarcity of exchange partners this structure is inefficient because it generates overlapping personal networks so that often too many people try to interact with the same partner at the same time.Interpersonal Commitment, Fairness, Reciprocity, Agent-Based Simulation, Help Exchange, Evolution

Co-employment of permanently and temporarily employed agents

One-shot interaction and repeated interaction often co-exist in the real world. We study possible behavioral effects of this co-existence in a principal-agent setting, in which a principal simultaneously employs a permanent and a temporary agent. Our experimental results indicate that there is "discrimination" between the two agents and that the available information for agents determines the extent of this discrimination, even though the theoretical solution of the game implies equal treatment of agents. Discrimination is, thus, a consequence of reciprocity. Agents that are discriminated against react negatively by withholding effort.principal-agent problem, permanent and temporary employment, fairness, wage discrimination

Control configurations in buyer-supplier relationships: environment- buyer organisation- goals and modes of control

Considering the growing externalisation of strategic activities, the problem of the control of buyer-supplier relationships is crucial. Therefore, researchers usually propose modes of control that are adapted to various environments. However, the organisations are often considered as “black boxes” whose goals are unspecified. This paper examines buyer-supplier control configurations that take into account the organisation of buying firms and their goals toward their suppliers. This research is based on six case studies conducted in the manufacturing industry (60 interviews). The outcome of the research is a matrix which represents four configurations of buyer-supplier control, based on the global purchasing environment of the buying firm (in terms of reciprocal dependence between the buyer and its suppliers). For each configuration, a type of purchasing organisation (structure and intra-organisational control of purchasing agents) and a principal goal for the buying firm are proposed: the lord-buyer wants to exert its power, the partner-buyer aims at assuring goal congruence with its suppliers, the vassal-buyer tries to reduce uncertainty and the market-buyer seeks to grasp opportunities on the market. For each configuration, the modes of control that the buyer exerts on its suppliers –in terms of means, objects of control, influence strategies of the buyer (more or less coercive) and suppliers reactions- are coherent with the main goal of the buyer.interorganisational control; buyer-supplier relationship; power; dependence; Goals of control

Article III: Further Building Blocks

Ye

Delegation, Knowledge Integration, and Cooperation: How to Solve Problems of Coordination in Structural Fund Programs. Findings From Comparative Case Studies in the South of Italy

European cohesion policies are increasingly relying on grassroots networks tapping into tacit knowledge and participatory decision-making processes. Regional governments delegate their decision making power to local institutions with the assumption that local agents possess both contextual knowledge and political legitimacy to integrate different policy measures in a cooperative fashion. Delegation of decision making power is therefore presumed to minimize the unintended or conflicting outcomes emerging, for instance, when environmental protection and infrastructure building are not designed consistently to local contextual needs nor are these pursued through a cooperative effort of local networks of actors. Different agents, including resource users and government agencies try to work together to resolve shared dilemmas of coordination, as an increasingly common alternative to centralized institutions. Coordination consists of managing interdependencies among multiple individuals or organizations involved in the overall program or project management. Several studies classify different types of coordination mechanisms, including standards, hierarchy, targets or plans, slack resources, vertical information systems, direct contact, liaison roles, task forces, and integrating roles. Other ways of classifying coordination include formal impersonal, formal interpersonal, and informal interpersonal; non-coordination, standards, schedules and plans, mutual adjustment, and teams; task-task, task-resource, and resource-resource coordination; vertical and horizontal coordination; coordination by programming and by feedback; and coordination by standards, plans, and mutual adjustment. Building upon a current field research in four regions of the South of Italy, this paper examines how coordination occurs across local development programs, which are embedded within multilevel governance structures and relations. The paper presents a number of cases of local collaborations in which large numbers of local actors representing a wide range of contending groups have, with the help of mediating institutions, worked out agreements for integrating development programs. In some circumstances, specific coordination mechanisms encouraged consensus building offering all relevant groups the knowledge and skills needed to participate in these negotiations. In other circumstances, though, delegation of decision making power opened the door for opportunistic participation, lacking vision and trust for mutual cooperation.

Networks Within Cities and Among Cities: A Paradigm for Urban Development and Governance

Networks and networking have become fashionable concepts and terms in regional science, and in particular in regional and urban geography in the last decade: we speak about network firms, network society, network economy but also network cities, city-networks, reti urbane, reseaux de villes. Only catch-words for somebody; a true new scientific paradigm according to others. Our opinion is that in fact we are confronted with a new paradigm in spatial sciences, under some precise conditions: - that its exact meaning is thoroughly defined, - that its theoretical economic rationale is justified, - that the novelty of its empirical content is clearly pointed out, with respect to more traditional spatial facts and processes that can easily be interpreted through existing spatial paradigms. The relevant theoretical building block on which the network concept or paradigm may be constructed are: - a new view of the economy as a system or web of links between individuals, firms and institutions, where links depend on experience and evolve through learning processes; the existing endowment of knowledge and other production factors is put into value through a relational capability addressed towards the exchange and collection of information, building reputation and trust, creating synergies, cutting down uncertainty, boosting learning processes; - the acknowledgement of cooperation as a new organisational and behavioural form, intermediate between hierarchy (internal development and merging of external activities through direct control) and market resort; cooperation networks among firms collaborating with each other on technological advances and innovation projects were the earlier phenomena that were abundantly explored in the past. In a spatial perspective, two phenomena in particular are worth exploring today through the network concept: - networking as cooperation among individuals, firms and institutions taking place inside the cities concerning collective action, public/private partnerships on large urban projects and the supply of public goods, and giving rise to new forms of urban governance; - networking as inter-urban cooperation, assuming the cities as economic actors, competing but also cooperating in the global arena where locations of internationally mobile factors (professionals, corporations, institutions) are decided and negotiated. The paper is organised in the following way: - a major section is devoted to the interpretation of the micro-economic efficiency of local networking (local urban networks), in terms of the usual criteria of optimal allocation of resources and collective welfare, viewing the network as an organisational alternative between market failure and state failure; - a transition section deals with the interpretation of cities, a collective actor at best, as individual/unitary economic actors, given the case for collective action among interest groups, the possibility of defining in broad terms a function of collective preference referring to non-mobile local actors, the engagement of public and private actors in processes of strategic planning and definition of shared visions for the future of the city vis-a-vis mobile actors; - another main section interprets competition and cooperation among cities (inter-city-networks) underlining advantages, risks and conditions for maximising overall comprehensive well-being. JEL classification: D70, H77, R58