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dc.contributor.authorPeeters, Ronald
dc.contributor.authorVorsatz, Marc
dc.identifier.citationPeeters, R., & Vorsatz, M. (2018). Simple guilt and cooperation (Discussion Paper No. 1801). University of Otago. Retrieved from
dc.description.abstractWe introduce simple guilt into a generic prisoner’s dilemma (PD) game and solve for the equilibria of the resulting psychological game. It is shown that for all guilt parameters, it is a pure strategy equilibrium that both players defect. But, if the guilt parameter surpasses a threshold, a mixed strategy equilibrium and a pure strategy equilibrium in which both players cooperate emerge. We implement three payoff constellations of the PD game in a laboratory experiment and find in line with our equilibrium analysis that first- and second-order beliefs are highly correlated and that the probability of cooperation depends positively on these beliefs. Finally, we provide numerical evidence on the degree of guilt cooperators experience.en_NZ
dc.publisherUniversity of Otagoen_NZ
dc.rightsAttribution-NonCommercial-ShareAlike 4.0 International*
dc.subjectPsychological game theoryen_NZ
dc.subjectPrisoner’s dilemmaen_NZ
dc.titleSimple guilt and cooperationen_NZ
dc.typeDiscussion Paperen_NZ
otago.schoolOtago Business School / Department of Economicsen_NZ
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Attribution-NonCommercial-ShareAlike 4.0 International
Except where otherwise noted, this item's licence is described as Attribution-NonCommercial-ShareAlike 4.0 International