Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/25672 
Year of Publication: 
2007
Series/Report no.: 
Jena Economic Research Papers No. 2007,098
Publisher: 
Friedrich Schiller University Jena and Max Planck Institute of Economics, Jena
Abstract: 
Using a symmetric 2-person prisoners’ dilemma as the base game, each player receives a signal for the number of rounds to be played with the same partner. The actual number of rounds (the length of the supergame) is determined by the maximal signal where each player expects the other’s signal to be smaller, respectively larger, by a fixed number of rounds with 50% probability. In the tradition of Folk Theorems we show that both, mutual defection and mutual cooperation until the individually perceived last round, are subgame perfect equilibrium outcomes. We find experimental evidence that many players do in fact cooperate beyond their individual signal period.
Subjects: 
Prisoners’ dilemma
Continuation probability
Uncertainty
Experiment
JEL: 
C91
D82
D84
Document Type: 
Working Paper

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