Abstract
This paper presents a model of the emergence of cooperative social norms in a society composed exclusively of rational agents. Following Kreps et al. [Kreps, D.M., Milgrom, P., Roberts, J., Wilson, R., 1982. Rational cooperation in the finitely repeated Prisoners' Dilemma. Journal of Economic Theory 27, 245-252], opportunistic agents are assumed to uphold cooperative norms in order to maintain reputations for being trustworthy - reputations which are necessary in order to find partners in mutually beneficial market and non-market transactions. Unlike the model of Kreps et al. [Kreps, D.M., Milgrom, P., Roberts, J., Wilson, R., 1982. Rational cooperation in the finitely repeated Prisoners' Dilemma. Journal of Economic Theory 27, 245-252], however, the present model endogenizes agents' prior beliefs regarding their partners' type, rather than introducing these priors by assumption. The model is supported by evidence from an international micro-data set on family behavior.
| Original language | English |
|---|---|
| Pages (from-to) | 117-151 |
| Number of pages | 35 |
| Journal | Journal of Public Economics |
| Volume | 81 |
| Issue number | 1 |
| DOIs | |
| State | Published - Jul 2001 |
Bibliographical note
Funding Information:This publication was made possible through support provided by the U.S. Agency for International Development under Cooperative Agreement No. DHR-0015-A-00-0031-00 to the Center on Institutional Reform and the Informal Sector (IRIS) and administered by the Office of Economic and Institutional Reform, Center for Economic Growth, Bureau for Global Programs, Field Support and Research. Financial support was also provided by the Azrieli Institute for Research on the Israeli Economy at Bar-Ilan University. I thank the Israel Social Sciences Data Archive (SSDA) at the Hebrew University of Jerusalem for providing the ISSP survey data, which were made available to the SSDA by the Zentralarchiv fuer Empirische Sozialforschung, Cologne, Germany. An earlier version of this paper was presented at the 1998 Meetings of the American Economic Association. Valuable comments were received from M. Kahneman, S. Skaperdas, and participants in seminars at Bar-Ilan University, New York University, Northwestern University, the University of Chicago and the University of California-Irvine.
Funding
This publication was made possible through support provided by the U.S. Agency for International Development under Cooperative Agreement No. DHR-0015-A-00-0031-00 to the Center on Institutional Reform and the Informal Sector (IRIS) and administered by the Office of Economic and Institutional Reform, Center for Economic Growth, Bureau for Global Programs, Field Support and Research. Financial support was also provided by the Azrieli Institute for Research on the Israeli Economy at Bar-Ilan University. I thank the Israel Social Sciences Data Archive (SSDA) at the Hebrew University of Jerusalem for providing the ISSP survey data, which were made available to the SSDA by the Zentralarchiv fuer Empirische Sozialforschung, Cologne, Germany. An earlier version of this paper was presented at the 1998 Meetings of the American Economic Association. Valuable comments were received from M. Kahneman, S. Skaperdas, and participants in seminars at Bar-Ilan University, New York University, Northwestern University, the University of Chicago and the University of California-Irvine.
| Funders | Funder number |
|---|---|
| Azrieli Institute for Research on the Israeli Economy at Bar-Ilan University | |
| United States Agency for International Development | DHR-0015-A-00-0031-00 |
Keywords
- Cooperation
- D64
- Intergenerational transfers
- J13
- J14
- O12
- Reciprocity
- Reputation
- Social norms