An Economics-Inspired Noise Model in Spatial Games with Reputation

* Final gross prices may vary according to local VAT.

Get Access

Abstract

Games are useful mathematical constructs to model real-world problems involving strategic interactions in various contexts such as politics, economics, and biology. Understanding specific conditions that lead to cooperation between self-interested individuals is an important issue in the study of real-world interactions. Although noisy and spatial interactions have been incorporated into models of complex interactions to better reflect those found in the real-world, most past studies consider simple extensions whereby interactions between all individuals are equally noisy. Here, we study a novel economics-inspired noise model based on the notion of psychic distance that reflects real-world interactions. The psychic noise that affects interactions between individuals depends on their psychic distance (e.g., cultural difference). Results from extensive computer simulations using a multi-agent system framework to investigate the impact of various constructions of noisy interactions indicate that noise typically has a negative impact on cooperation. However, a certain condition produces results reminiscent of the psychic distance paradox, where an increase in the noise level leads to an increase in the level of cooperation.