Simulating International Cooperation under Uncertainty

Abstract

The repeated prisioner's dilemma is representative of a broad range of situations in international security and trade. This article examines the effects of asymmetric noise on the emergence and maintenance of cooperation under such conditions. The results show that positive and negative asymmetric noise have very different effects on strategy performance. For forgiving strategies, positive noise provides a stimulus out of perpetual defection or unsynchronized retaliations, but also opens them to exploitation. For provocable strategies, negative noise triggers unsynchronized retaliations or perpetual defection, although this may be tempered by generosity and contrition. The effects of neutral noise reflects the signature of each asymmetric noise type. Of the strategies examined, contrite tit-for-tat (CTFT) is generally one of the best performers in both homogeneous and heterogeneous systems. Moreover, one generally sees the evolutionary models moving from heterogeneous bilateral interaction to cooperative norms of behavior, often including or even dominated by CTFT.