RECIPROCITY AND THE EMERGENCE OF REPUTATION

Before reputation can be cultivated it must be conferred; individuals must seek information relevant to a future social partner prior to actual interaction. Such information may be gathered by observing a future social partner in interaction with another. Use of vicarious observation to direct initial play in actual encounter we term minimal attributed reputation. We model minimal attributed reputation by the strategy Observer Tit For Tat (OTFT), which behaves like Tit For Tat (TFT) when ignorant of a new partner but begins by defecting on a new partner if that partner was seen defecting on another. TFT can resist invasion by OTFT in the presence of recurring mutant unilateral defectors. Yet OTFT is evolutionarily stable when TFT is not; similarly, OTFT requires less clustering than TFT to invade a world of unilateral defection. OTFT is evolutionarily superior to TFT under low probabilities of future interaction between partners; indeed, in principle OTFT requires no future interaction between partners. As the probability of future interaction increases, TFT supplants OTFT. Thus, minimal reputation evolves when the duration of pair-wise interaction is relatively uncertain. © 1992 Academic Press Limited All rights reserved.