Who cooperates in repeated games: The role of altruism, inequity aversion, and demographics

We explore the extent to which altruism, as measured by giving in a dictator game (DG), accounts for play in a noisy version of the repeated prisoner's dilemma. We find that DG giving is correlated with cooperation in the repeated game when no cooperative equilibria exist, but not when cooperation is an equilibrium. Furthermore, none of the commonly observed strategies are better explained by inequity aversion or efficiency concerns than money maximization. Various survey questions provide additional evidence for the relative unimportance of social preferences. We conclude that cooperation in repeated games is primarily motivated by long-term payoff maximization and that even though some subjects may have other goals, this does not seem to be the key determinant of how play varies with the parameters of the repeated game. In particular, altruism does not seem to be a major source of the observed diversity of play.Economic

Winners Don't Punish

Economic

Flows and Decompositions of Games: Harmonic and Potential Games

In this paper we introduce a novel flow representation for finite games in strategic form. This representation allows us to develop a canonical direct sum decomposition of an arbitrary game into three components, which we refer to as the potential, harmonic and nonstrategic components. We analyze natural classes of games that are induced by this decomposition, and in particular, focus on games with no harmonic component and games with no potential component. We show that the first class corresponds to the well-known potential games. We refer to the second class of games as harmonic games, and study the structural and equilibrium properties of this new class of games. Intuitively, the potential component of a game captures interactions that can equivalently be represented as a common interest game, while the harmonic part represents the conflicts between the interests of the players. We make this intuition precise, by studying the properties of these two classes, and show that indeed they have quite distinct and remarkable characteristics. For instance, while finite potential games always have pure Nash equilibria, harmonic games generically never do. Moreover, we show that the nonstrategic component does not affect the equilibria of a game, but plays a fundamental role in their efficiency properties, thus decoupling the location of equilibria and their payoff-related properties. Exploiting the properties of the decomposition framework, we obtain explicit expressions for the projections of games onto the subspaces of potential and harmonic games. This enables an extension of the properties of potential and harmonic games to "nearby" games. We exemplify this point by showing that the set of approximate equilibria of an arbitrary game can be characterized through the equilibria of its projection onto the set of potential games

Polymer Models of Topological Insulators

Physic

Phase Transition and Symmetry Breaking in the Minority Game

We show that the Minority Game, a model of interacting heterogeneous agents, can be described as a spin systems and it displays a phase transition between a symmetric phase and a symmetry broken phase where the games outcome is predicable. As a result a ``spontaneous magnetization'' arises in the spin formalism.Comment: 4 pages, 2 figures, submitted to PRE/Rapid Communications Major revision of the tex