Forgiver triumphs in alternating Prisoner's Dilemma

TL;DR

This paper analyzes the evolution of cooperation in the alternating Prisoner's Dilemma, demonstrating that the forgiving strategy Forgiver often leads to stable cooperation despite noise and exploitation.

Contribution

It introduces and analyzes the role of the Forgiver strategy in the alternating Prisoner's Dilemma, showing its effectiveness in promoting stable cooperation.

Findings

Forgiver often dominates in equilibrium under various conditions.

The Forgiver strategy facilitates long-term cooperation despite short-term losses.

The alliance ruled by Forgiver is asymptotically stable.

Abstract

Cooperative behavior, where one individual incurs a cost to help another, is a wide spread phenomenon. Here we study direct reciprocity in the context of the alternating Prisoner's Dilemma. We consider all strategies that can be implemented by one and two-state automata. We calculate the payoff matrix of all pairwise encounters in the presence of noise. We explore deterministic selection dynamics with and without mutation. Using different error rates and payoff values, we observe convergence to a small number of distinct equilibria. Two of them are uncooperative strict Nash equilibria representing always-defect (ALLD) and Grim. The third equilibrium is mixed and represents a cooperative alliance of several strategies, dominated by a strategy which we call Forgiver. Forgiver cooperates whenever the opponent has cooperated; it defects once when the opponent has defected, but subsequently Forgiver attempts to re-establish cooperation even if the opponent has defected again. Forgiver is not an evolutionarily stable strategy, but the alliance, which it rules, is asymptotically stable. For a wide range of parameter values the most commonly observed outcome is convergence to the mixed equilibrium, dominated by Forgiver. Our results show that although forgiving might incur a short-term loss it can lead to a long-term gain. Forgiveness facilitates stable cooperation in the presence of exploitation and noise.