Studies of iterated prisoner's dilemmas (IPD) have shown that agents can escape the social trap of mutual defection by focusing on future gains or by learning from prior experiences. This terrain has been well charted. Yet only recently has attention turned to how groups of agents engage in an IPD scenario against other groups, a scenario that the author dubs “two-level social traps.” This article investigates the impact of group size on the performance of groups in a two-group IPD based on Michael W. Macy's STOCHASTIC LEARNING MODEL OF SOCIAL EXCHANGE. The findings of the study suggest that when a democratic (majoritarian) decision rule is used, larger groups perform better in moving from an uncooperative equilibrium to a cooperative equilibrium. The proposed explanation for this is that larger groups reduce uncertainty in the random processes of strategy selection.
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