Iterated Prisoner's Dilemma, Reputation
The Repeated Game
The Repeated Game is an Iterated Prisoner's Dilemma and Reputation scenario. The core lesson: The shadow of the future transforms a defection game into a cooperation game. You're playing Prisoner's Dilemma with the same opponent, repeatedly, for an unknown number of rounds. They will remember everything you did. DecisionPlay maps the players, payoffs, and equilibrium dynamics that shape how this situation typically resolves.
The situation
You're playing Prisoner's Dilemma with the same opponent, repeatedly, for an unknown number of rounds. They will remember everything you did.
Background
In a one-shot Prisoner's Dilemma, the dominant strategy is to defect, always. But when the game is repeated, the logic changes completely. Future interaction creates an incentive to cooperate now. Robert Axelrod's famous computer tournaments showed that Tit-for-Tat, cooperate first, then do whatever your opponent did last round, consistently outperformed all other strategies across many types of opponents. The 'shadow of the future' is the concept: how much the prospect of future interaction shapes current behavior.
What this reveals
The shadow of the future
Cooperation in repeated games is sustained by the credible threat of future punishment, and the credible promise of future reward. Remove the future, and cooperation unravels. Extend the future, and defection becomes irrational.
How to counter it: Ask yourself: am I treating this like a one-shot game when it's actually repeated? Most important relationships are infinitely repeated. The move that maximizes short-run gain almost always destroys long-run value.
A question to sit with
Is there a relationship in your life where one person is playing a repeated game and the other is playing one-shot? Who is each person, and what is the cost of that asymmetry?
Frequently asked questions
- What game theory concept does The Repeated Game illustrate?
- The Repeated Game illustrates Iterated Prisoner's Dilemma, Reputation. The shadow of the future transforms a defection game into a cooperation game.
- What is the situation in The Repeated Game?
- You're playing Prisoner's Dilemma with the same opponent, repeatedly, for an unknown number of rounds. They will remember everything you did.
- What does The Repeated Game reveal about how people decide?
- The shadow of the future. Cooperation in repeated games is sustained by the credible threat of future punishment, and the credible promise of future reward. Remove the future, and cooperation unravels. Extend the future, and defection becomes irrational.
- How do you avoid the trap in The Repeated Game?
- Ask yourself: am I treating this like a one-shot game when it's actually repeated? Most important relationships are infinitely repeated. The move that maximizes short-run gain almost always destroys long-run value.
- What is the research behind The Repeated Game?
- In a one-shot Prisoner's Dilemma, the dominant strategy is to defect, always. But when the game is repeated, the logic changes completely. Future interaction creates an incentive to cooperate now.
- How long does The Repeated Game take to play?
- About 10 min, at advanced difficulty, across 4 decision points. It runs in your browser with no account and no sign-in.
Keep exploring
More Classical Game Theory scenarios, or browse all scenarios. New to this? Start with how DecisionPlay works or the game theory glossary.
Topics: iterated-pd, reputation, cooperation, tit-for-tat