Translucent Players: Explaining Cooperative Behavior in Social Dilemmas

TL;DR

This paper introduces the concept of translucent players, whose strategy deviations can be visible to others, providing a new explanation for cooperative behavior in social dilemmas.

Contribution

It proposes a novel framework of translucent players to explain cooperation, contrasting with traditional opaque-player assumptions, and aligns with observed human behaviors.

Findings

Translucent players model explains cooperation in social dilemmas.

The approach accounts for behaviors in Prisoner's Dilemma, Traveler's Dilemma, Bertrand Competition, and Public Goods game.

It reproduces regularities observed in human experiments.

Abstract

In the last few decades, numerous experiments have shown that humans do not always behave so as to maximize their material payoff. Cooperative behavior when non-cooperation is a dominant strategy (with respect to the material payoffs) is particularly puzzling. Here we propose a novel approach to explain cooperation, assuming what Halpern and Pass (2013) call "translucent players". Typically, players are assumed to be "opaque", in the sense that a deviation by one player does not affect the strategies used by other players. But a player may believe that if he switches from one strategy to another, the fact that he chooses to switch may be visible to the other players. For example, if he chooses to defect in Prisoner's Dilemma, the other player may sense his guilt. We show that by assuming translucent players, we can recover many of the regularities observed in human behavior in well-studied games such as Prisoner's Dilemma, Traveler's Dilemma, Bertrand Competition, and the Public Goods game.