Decentralized Interaction and Co-Adaptation in the Repeated Prisoner‘sDilemma

  • Authors:
  • Tomas B. Klos

  • Affiliations:
  • Faculty of Management and Organization, University of Groningen, P.O. Box 800, 9700 AV Groningen, The Netherlands. t.b.klos@bdk.rug.nl

  • Venue:
  • Computational & Mathematical Organization Theory
  • Year:
  • 1999

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Abstract

A Prisoner‘s dilemma that is repeated indefinitely has manyequilibria; the problem of selecting among these is often approachedusing evolutionary models. The background of this paper is a numberof earlier studies in which a specific type of evolutionary model, agenetic algorithm (GA), was used to investigate which behaviorsurvives under selective pressure. However, that normative instrumentsearches for equilibria that may never be attainable. Furthermore, itaims for optimization and, accordingly, says what people should do to be successful in repeated prisoner‘s dilemma (RPD) typesituations. In the current paper, I employ simulation to findout what people would do, whether this makes them successful ornot. Using a replication of Miller‘s (1988) GA study for comparison,a model is simulated in which the population is spatially distributedacross a torus. The agents only interact with their neighbors andlocally adapt their strategy to what they perceive to be successfulbehavior among those neighbors. Although centralized GA-evolution maylead to somewhat better performance, this goes at the cost of a largeincrease in required computations while a population withdecentralized interactions and co-adaptation is almost as successfuland, additionally, endogenously learns a more efficient scheme foradaptation. Finally, when the agents‘ perceptive capabilities arelimited even further, so that they can only perceive how theirneighbors are doing against themselves, rather than against all thoseneighbors‘ opponents—which essentially removes reputation as asource of information—cooperation breaks down.