The Sequential Prisoner's Dilemma: Evidence on Reciprocation

Abstract

We investigate how fairness concerns influence individual behaviour in social dilemmas. Using a Sequential Prisoner's Dilemma experiment we analyse the extent to which co‐operation is conditional on first‐mover co‐operation, repetition, economic incentives, subject pool (United Kingdom vs. United States) and gender. We find the most important variable influencing co‐operation is the first‐mover's choice, supporting the argument that co‐operative behaviour in social dilemmas reflects reciprocation rather than unconditional altruism. However, we also find that co‐operation decreases with repetition, and reciprocation falls as its material cost rises.