Abstract
The punishment effect on social behavior is analyzed within the strategic interaction framework of Cellular Automata and computational Evolutionary Game Theory. A new game, called Social Honesty (SH), is proposed. The SH game is analyzed in spatial configurations. Probabilistic punishment is used as a dishonesty deterrence mechanism. In order to capture the intrinsic uncertainty of social environments, payoffs are described as random variables. New dynamics, with a new relation between punishment probability and punishment severity, are revealed. Punishment probability proves to be more important than punishment severity in guiding convergence towards honesty as predominant behavior. This result is confirmed by empirical evidence and reported experiments. Critical values and transition intervals for punishment probability and severity are identified and analyzed. Clusters of honest or dishonest players emerge spontaneously from the very first rounds of interaction and are determinant for the future dynamics and outcomes.
Highlights
Dynamics of honest/dishonest behavior in social and economic environments are of particular interest as they are important influencers of social functionality
H and D-player rates become approximately stable after about 150 rounds and remain almost unchanged for 100,000 rounds (60% H-players, 40% D players), indicating a kind of dynamic equilibrium
The upper bound of this interval is close to the upper bounds of the intervals obtained for von Neumann and Moore neighborhoods
Summary
Dynamics of honest/dishonest behavior in social and economic environments are of particular interest as they are important influencers of social functionality. Honesty and trust are considered the main foundations of social order. Dishonesty often leads to undesired social phenomena undermining common welfare [1]. In the economic realm, dishonest behavior and the associated corruption may generate market failure and poverty [3]. The 2008 crisis illustrates the effects of dishonest behavior. The lack of regulation and control made this possible. When the tailors of such speculative schemes are questioned about their deeds the answer is most often: ‘because we can, because the control is loose, because state authorities lack the resources to catch people like me’ (see the declarations of Bernard Madoff - operator of the largest financial fraud in U.S history). Due to the wide spread of information technology, the contagion of such behaviors is easier and faster than before [5]
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