Documentos de Trabajo del IUDEM

2000-3 

COOPERATIVE BEHAVIOR IN THE PRISONER DILEMMA: 

THE ROLE OF RULES IN INSTITUTIONS

José Casas Pardo
Juan D. Montoro-Pons

ABSTRACT

A basic problem that may arise in situations of collective decision-making is that of individual rationality vs. collective welfare which can be depicted by the prisoner dilemma. The problem has been widely analyzed in the game theory literature yielding several insights to the problem of social cooperation mostly based in the differences posed by short term vs. long term relationships between the players. The following paper deals with a dynamic setting of the prisoner dilemma, in which a coordination mechanism, to be understood as the set of norms of the institution, play a key role in achieving cooperation between the participants. Moreover cooperation is maintained for any number of players.

Keywords: Cooperation, legal systems, collective institutions, strategic behavior, controlled game.

JEL: C72, C73, D74.