Stability in negotiation games and the emergence of cooperation

Abstract

Consider a two-player game in which each player contributes a costly resource to the common good of the pair. For such contests, the Nash equilibrium contribution, x*, is one for which neither player can increase its pay-off by unilaterally altering its contribution from x*. We study an elaboration of this game, which allows the players to exchange x-offers back and forth in a negotiation phase until they converge to a final pair of contributions, x1 and x2. A significant feature of such negotiation games, hitherto unrecognized, is the existence of a set of neutrally stable equilibrium points in negotiation phase space. To explore the long-term evolutionary outcome of such games, we simulate populations containing various mixtures of negotiation strategies and, contrary to previous results, we often find convergence to a contribution that is more cooperative than the Nash equilibrium. Mathematical analysis suggests why this might be happening, and provides a novel and robust explanation for cooperation, that negotiation can facilitate the evolution of cooperative behaviour.