Does Spending More Always Ensure Higher Cooperation? An Analysis of Institutional Incentives on Heterogeneous Networks

Theodor Cimpeanu (), Francisco C. Santos and The Anh Han ()
Additional contact information
Theodor Cimpeanu: University of St Andrews
Francisco C. Santos: Universidade de Lisboa
The Anh Han: Teesside University

Dynamic Games and Applications, 2023, vol. 13, issue 4, No 10, 1236-1255

Abstract: Abstract Humans have developed considerable machinery used at scale to create policies and to distribute incentives, yet we are forever seeking ways in which to improve upon these, our institutions. Especially when funding is limited, it is imperative to optimise spending without sacrificing positive outcomes, a challenge which has often been approached within several areas of social, life and engineering sciences. These studies often neglect the availability of information, cost restraints or the underlying complex network structures, which define real-world populations. Here, we have extended these models, including the aforementioned concerns, but also tested the robustness of their findings to stochastic social learning paradigms. Akin to real-world decisions on how best to distribute endowments, we study several incentive schemes, which consider information about the overall population, local neighbourhoods or the level of influence which a cooperative node has in the network, selectively rewarding cooperative behaviour if certain criteria are met. Following a transition towards a more realistic network setting and stochastic behavioural update rule, we found that carelessly promoting cooperators can often lead to their downfall in socially diverse settings. These emergent cyclic patterns not only damage cooperation, but also decimate the budgets of external investors. Our findings highlight the complexity of designing effective and cogent investment policies in socially diverse populations.

Keywords: Evolutionary game theory; Evolution of cooperation; Cost efficiency; Incentives; Scale-free networks; Prisoners’ dilemma (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://link.springer.com/10.1007/s13235-023-00502-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:dyngam:v:13:y:2023:i:4:d:10.1007_s13235-023-00502-1

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/13235

DOI: 10.1007/s13235-023-00502-1

Access Statistics for this article

Dynamic Games and Applications is currently edited by Georges Zaccour

More articles in Dynamic Games and Applications from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().