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Formation and long‐run stability of cooperative groups in a social dilemma situation
Author(s) -
Maruta Toshimasa,
Okada Akira
Publication year - 2015
Publication title -
international journal of economic theory
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.351
H-Index - 11
eISSN - 1742-7363
pISSN - 1742-7355
DOI - 10.1111/ijet.12056
Subject(s) - negotiation , dilemma , social dilemma , economics , microeconomics , nash equilibrium , mathematical economics , repeated game , institution , group (periodic table) , dove , stability (learning theory) , maximization , class (philosophy) , game theory , political science , computer science , mathematics , law , chemistry , geometry , organic chemistry , machine learning , artificial intelligence
We consider the formation and long‐run stability of cooperative groups in a social dilemma situation where the pursuit of individual interests conflicts with the maximization of social welfare. The adaptive play model of Young ([Young, P. H., 1993]) is applied to a group formation game where voluntary participants negotiate to create an institution that enforces cooperation. For the class of group formation games with two types, the stochastically stable equilibrium can be characterized in terms of the Nash products of the associated hawk–dove games, which summarize the strategic interaction among the individuals in the game.