Lesson
The theory โ The Prisoner's Dilemma, and Axelrod's Tournament
A game is a prisoner's dilemma when its four payoffs satisfy two inequalities. T > R > P > S makes defecting the better reply to either move, so both players defect and both do worse than if both had cooperated. And 2R > T + S makes mutual cooperation better for the pair than taking turns exploiting each other โ which is what makes the repeated game worth playing rather than a race to alternate.
What each symbol means
T- the temptation: what you get for defecting on a cooperator
R- the reward: what you both get for cooperating
P- the punishment: what you both get for defecting
S- the sucker: what you get for cooperating with a defector
Problem solved in full
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How long does the relationship have to be? The tool plays a fixed number of rounds, and none of its eight strategies plays any differently as the end approaches. A real repeated game ends at a moment nobody can name, so the question is not how many rounds there are but how likely another one is.
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Call w the chance that the match continues after this round. Against Grudger, which punishes one defection for ever, cooperating for ever pays R each round, and that geometric series sums to R over 1 minus w.
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Defecting once pays T this round and P in every round after it, because Grudger never comes back.
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Cooperation holds when the first is at least the second. Multiply through by 1 minus w and the series disappears, leaving one inequality in w.
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With Axelrod's payoffs that is two over four. The match needs an even chance of continuing or better, which is an expected length of two rounds.
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Now the same deviation against Tit for Tat, which punishes for one round and then forgives: the deviator gets T, then S, then R again for ever. The threshold rises to two thirds, an expected length of three rounds.
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Here the more forgiving punisher needs the longer relationship, and the reason is on the line above: T โ P is the larger gap. It is not a general rule. Over the 250 whole-number dilemmas these four inputs allow it holds in 50 and reverses in 130 โ set T to 4 and P to 2 and Tit for Tat needs only a third.
Answer
Against a punisher that never forgives, cooperation is stable once w reaches (T โ R)/(T โ P) = 1/2, an expected two rounds. Against one that forgives after a single round it takes (T โ R)/(R โ S) = 2/3, an expected three. The tool's own crossover is 4, and the gap between two and four is the field: the threshold asks when cooperating beats defecting between two players, while the table asks when a cooperator's average across eight opponents beats a defector's, and three of those eight defect first. Two rounds buys a stable pair. Four buys a league.
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Learning path
The best reply, and what happens when nobody computes one
References (4)
- The tournament this tool reproduces, reported by the man who ran it โ the source for the 1980 date, for the fourteen entries plus RANDOM, and for the nice/not-nice split: R. Axelrod, "Effective Choice in the Prisoner's Dilemma." Journal of Conflict Resolution 24(1), 1980, pp. 3โ25.
- "Don't be envious", and the argument that a strategy losing every match can still win the tournament: R. Axelrod, The Evolution of Cooperation. Basic Books, New York, 1984.
- The 1950 RAND experiment the game came out of, written up by one of the two men who invented it. Albert Tucker gave it the prisoners and the name; this is the experiment: M. M. Flood, "Some Experimental Games." Management Science 5(1), 1958, pp. 5โ26.
- Why the winner changes when moves come out wrong, and where the one-in-three forgiveness rate this tool gives Generous Tit for Tat comes from: P. Molander, "The Optimal Level of Generosity in a Selfish, Uncertain Environment." Journal of Conflict Resolution 29(4), 1985, pp. 611โ618.