The Evolution of Institution: An Evolutionary Game Theory Approach

Abstract

"For these reasons, it becomes interesting to ask how cooperation can emerge in Prisoners' Dilemma situation without using a super-game approach. One possible candidate for overcoming this anomaly is the evolution of institutions for resolving collective action problem. Contrary to the theoretical predictions based on "Free-Rider hypothesis" (for example, Taylor 1987, 158), there are many instances of social life governed by unwritten laws and customs where the 'Leviathan' plays little or no role (see E. Ostrom 1989, 1990a, 1990b, 1991; Ostrom et. al. 1990, 1991; Feeny et al. 1990; Rowe 1990; Snidal 1985; Sened 1991; Tang 1991). This implies that, cooperative solution can emerge in Prisoners' Dilemma situation through self-governing institutions."