Abstract
Both the Trust Game and the Ultimatum Game reduce, in their most simplified versions, to a Public Good Game with an added incentive: namely a reward in the first case, and a sanction in the other. In this paper, the evolutionary game dynamics of these games is analyzed by means of the replicator equation. Positive and negative incentives have very different but complementary effects. We investigate the role of reputation, and show how occasional failures to contribute can lead to stabilizing cooperation.
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De Silva, H., Sigmund, K. (2009). Public Good Games with Incentives: The Role of Reputation. In: Levin, S. (eds) Games, Groups, and the Global Good. Springer Series in Game Theory. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-85436-4_5
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DOI: https://doi.org/10.1007/978-3-540-85436-4_5
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