A theory of sequential reciprocity

M. Dufwenberg and Georg Kirchsteiger ()

No 37, Discussion Paper from Tilburg University, Center for Economic Research

Abstract: Many experimental studies indicate that people are motivated by reciprocity. Rabin (1993) develops techniques for incorporating such concerns into game theory and economics. His model, however, does not fare well when applied to situations with an interesting dynamic structure (like many experimental games), because it is developed for normal form games in which information about the sequential structure of a strategic situation is suppressed.In this paper we develop a theory of reciprocity for extensive games in which the sequential structure of a strategic situation is made explicit. We propose a new solution concept-sequential reciprocity equilibrium-which is applicable to extensive games, and we prove a general equilibrium existence result. The model is applied in several examples, including some well known experimental games like the Ultimatum game and the Sequential Prisoners'Dilemma.

JEL-codes: A13 C70 D63 (search for similar items in EconPapers)
Date: Written 1998
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Related works:
Working Paper: A Theory of Sequential Reciprocity (2001)
Journal Article: A theory of sequential reciprocity (2004)
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