It's the thought that counts: The role of intentions in reciprocal altruism *

We examine cooperation in repeated interactions where intended actions are implemented with noise but intentions are perfectly observable. Observable intentions lead to more cooperation compared to control games where intentions are unobserved, allowing subjects to reach similar cooperation levels as in games without noise. Most subjects condition exclusively on intentions, and use simpler, lower-memory strategies compared to games where intentions are unobservable. When the returns to cooperation are high, some subjects are tolerant, using good outcomes to forgive attempted defections; when the returns to cooperation are low, some subjects are punitive, using bad outcomes to punish accidental defections.

[1]  R. Porter,et al.  NONCOOPERATIVE COLLUSION UNDER IMPERFECT PRICE INFORMATION , 1984 .

[2]  R. Radner,et al.  An Example of a Repeated Partnership Game with Discounting and with Uniformly Inefficient Equilibria , 1986 .

[3]  E. Stacchetti,et al.  Towards a Theory of Discounted Repeated Games with Imperfect Monitoring , 1990 .

[4]  D. Fudenberg,et al.  Digitized by the Internet Archive in 2011 with Funding from Working Paper Department of Economics the Folk Theorem with Imperfect Public Information , 2022 .

[5]  S. Blount.  When Social Outcomes Aren't Fair: The Effect of Causal Attributions on Preferences , 1995 .

[6]  U. Fischbacher,et al.  On the Nature of Fair Behavior , 1999 .

[7]  Jordi Brandts,et al.  Reference Points and Negative Reciprocity in Simple Sequential Games , 2001, Games Econ. Behav..

[8]  Gary E. Bolton,et al.  Fair Procedures: Evidence from Games Involving Lotteries , 2000 .

[9]  Paul M. Brown,et al.  What Makes an Allocation Fair? Some Experimental Evidence , 2002, Games Econ. Behav..

[10]  P. V. van Lange,et al.  How to overcome the detrimental effects of noise in social interaction: the benefits of generosity. , 2002, Journal of personality and social psychology.

[11]  V. Smith,et al.  Positive reciprocity and intentions in trust games , 2003 .

[12]  BÓ Pedrodal,et al.  Cooperation under the Shadow of the Future : Experimental Evidence from Infinitely Repeated Games , 2005 .

[13]  A. Roth,et al.  The Speed of Learning in Noisy Games: Partial Reinforcement and the Sustainability of Cooperation , 2006 .

[14]  U. Fischbacher.  z-Tree: Zurich toolbox for ready-made economic experiments , 1999 .

[15]  G. Charness,et al.  Intention and Stochastic Outcomes: An Experimental Study , 2005 .

[16]  David G. Rand,et al.  Winners don’t punish , 2008, Nature.

[17]  Ernst Fehr,et al.  Testing Theories of Fairness - Intentions Matter , 2000, Games Econ. Behav..

[18]  S. B. Thompson.  Simple Formulas for Standard Errors that Cluster by Both Firm and Time , 2009 .

[19]  Eric T. Bradlow,et al.  Bayesian analysis of deterministic and stochastic prisoner’s dilemma games , 2009, Judgment and Decision Making.

[20]  Masaki Aoyagi,et al.  Collusion as public monitoring becomes noisy: Experimental evidence , 2009, J. Econ. Theory.

[21]  F. Cushman,et al.  Accidental Outcomes Guide Punishment in a “Trembling Hand” Game , 2009, PloS one.

[22]  David G. Rand,et al.  The online laboratory: conducting experiments in a real labor market , 2010, ArXiv.

[23]  David G. Rand,et al.  Slow to Anger and Fast to Forgive: Cooperation in an Uncertain World , 2010 .

[24]  G. Spagnolo,et al.  Equilibrium Selection in the Repeated Prisoner's Dilemma: Axiomatic Approach and Experimental Evidence , 2011 .

[25]  David A. Lagnado,et al.  Beyond Outcomes: The Influence of Intentions and Deception , 2011, CogSci.

[26]  B. Greiner,et al.  Imperfect Public Monitoring with Costly Punishment - An Experimental Study , 2011 .

[27]  Guillaume Fréchette,et al.  The Evolution of Cooperation in Infinitely Repeated Games: Experimental Evidence , 2011 .

[28]  M. Bigoni,et al.  Flexibility and Collusion with Imperfect Monitoring , 2012 .

[29]  David G. Rand,et al.  Spontaneous giving and calculated greed , 2012, Nature.

[30]  Guillaume Fréchette,et al.  Strategy Choice in the Infinitely Repeated Prisoners’ Dilemma , 2015, American Economic Review.

[31]  C. D. De Dreu.  Human Cooperation , 2013, Psychological science in the public interest : a journal of the American Psychological Society.

[32]  Roman M. Sheremeta,et al.  Principal-Agent Settings with Random Shocks , 2012, Manag. Sci..

[33]  Masaki Aoyagi,et al.  The Impact of Monitoring in Infinitely Repeated Games: Perfect, Public, and Private , 2015, American Economic Journal: Microeconomics.