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Contribution Details

Type Working Paper
Scope Discipline-based scholarship
Title Long-term commitment and cooperation
Organization Unit
  • Frédéric-Guillaume Schneider
  • Roberto A. Weber
  • English
Institution University of Zurich
Series Name Working paper series / Department of Economics
Number 130
ISSN 1664-7041
Number of Pages 50
Date 2013
Abstract Text We study how the willingness to enter long-term bilateral relationships affects cooperation even when parties have little information about each other, ex ante, and cooperation is otherwise unenforceable. We experimentally investigate a finitely-repeated Prisoner’s Dilemma, allowing players to endogenously select interaction durations. Consistent with prior research, longer interactions facilitate cooperation. However, many individuals avoid long-term commitment, with uncooperative types less likely to commit than conditional cooperators. Endogenously chosen long-term commitment yields higher cooperation rates (98% in one condition) than exogenously imposed commitment. Thus, the willingness to enter into long-term relationships provides a means for fostering - and screening for - efficient cooperation.
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Keywords Repeated games, cooperation, voluntary commitment, Verhalten, Entscheidungsverhalten, Entscheidungstheorie, Entscheidung, Commitment, Management, Kooperation, intrinsische Motivation