PRISONERS DILEMMA &

MONOGAMOUS
RELATIONSHIPS
Game Theory Assignment

Submitted By: Abhinand. C, 540

APRIL 20, 2021

DEPARTMENT OF BUSINESS ECONOMICS
UNIVERSITY OF DELHI
Introduction
Here I am modelling the long-term monogamous relationship between 2 partners by
considering the classic case of Prisoners Dilemma which is played in a repeated manner by
the players over the time. The strategic form of Prisoners dilemma is given below and a
heterosexual couple will be the players in this game. For the purpose of Analysis, I had
assumed that these same payoffs will be faced by all the people engaging in monogamous
relationships.
P1/P2 C D
C 2,2 0,3
D 3,0 1,1

‘C’ represents that both the partners are cooperating and remaining faithful in the
relationship so that they get the payoffs that arise from financial security, emotional support
and better competency in raising their child/children. Here D represents the action of one
partner indulging in an extra marital affair to fulfil their short-term pleasures. And for the
purpose of our analysis ‘D’ also represents the state in which both the couples are engaged
in a legal battle after divorce or any similar instances when their non-cooperation leads to
increased costs and decreased payoffs. This usually happens after an instance of non-
cooperation or unfaithfulness from any one of the partners.

Action Profiles
The payoffs for each partner for the different action profiles are given in the above table with
intuitive reasoning as follows. Action profile (C, C) represents the case where both the
partners are cooperating so as to get the total overall payoff for both of them. Either explicitly
or implicitly, people will convince their partners that they will cooperate for the time
foreseeable and this mutual understanding forms the basis of a relationship. Here I had given
the payoff that each partner will attain in this state as 2.
The action profile (D, C) and (C, D) represents the case where one partner is cooperating and
the other partner is choosing not to remain faithful. While considering this action profile the
payoff of 3 is always reached when the later does not have perfect information regarding the
other partner. A real-life scenario would be the one of them visiting a foreign country alone
and indulging in an affair during his stay in that country. Here the partner who is staying back
is not aware of her partners actions and remain faithful with the expectation that the partner
will also do the same. Thus, resulting in a higher payoff for the cheating partner which is
derived from the long-term benefits of the relationship and from the short-term pleasures he
got out of cheating.
The action profile (D, D) is reached when both of them are not cooperating in a relationship
in terms of how it should ideally be. This take in different forms and one would be in the form
of a divorce which is associated with high legal fees, high costs of not raising their children
together or even staying in the same house with both minding their own business. All these
cases will certainly result in a payoff that is far less than when they are cooperating and, in
this case, I had given it as (1,1).

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Long-term Analysis with Perfect Information
We need to consider Monogamous relation where each Partner had initially relied to the
strategy (C, C) and there occurred a situation where one partner deviated from the strategy
and see how relationships work out in the long run. I am modelling this situation with an
infinitely repeated prisoner’s dilemma.
Here in the long run, the cheating partner has to show some remorse and stick to switch back
to ‘C’ no matter what the other partners strategy is. The behaviour which depicts winning
back the trust is seen common in Humans. And similarly, forgiveness is an emotion that is
wired into Humans which will make the second partner to change back to ‘C’ after observing
the cheated partner who is trying to win back her trust.
The payoffs for both the partners if they punish each other are (1,1) for the time foreseeable.
The cheating partner who is responding the punishment is rational and will be analysing the
payoffs at the end of each history when it’s his time to take a position. Similarly, the faithful
partner will also be analysing her payoffs after the first punishment which she had given. For
the purpose of analysis, I had taken a discount factor ‘β’ which is less than one and greater
than zero in order to discount future payoffs. ‘β’ will tend to be smaller for people who value
the present a lot more than the future, that is they are more impatient.

Cheaters Payoff after the outcome (D, C)

In next period, the cheater can be sure that if his partner will resort to the strategy ‘D’ no
matter whatever be his strategy. Had he also chosen ‘D’, it will again trigger the punishments
by partner in the subsequent rounds. On the other hand, had he responded to the
punishment by ‘C’ instead of ‘D’ he can expect his partner to forgive him and choose ‘C’ in the
next period. These 2 strategies are described below.
Case 1: He chooses ‘D’ in response to the punishment in the next round. This will trigger more
punishments by the partner and results in the payoffs (1,1), (1,1), (1,1) and so on. The
expected average payoffs for the cheating partner are (1- β) *(1+ β + β ^2+ β ^3…) =1.
Case 2: He chooses ‘C’ in response to the punishment in next round. This may make the
faithful partner forgive the cheater in the next round as forgiveness is a built-in human
emotion and will result in payoffs (0,3), (2,2), (2,2), (2,2) and so on. The expected average
payoffs for the cheating partner are (1- β) *(0+2* β +2* β ^2…) = 2* β

So, the cheating partner has the incentive to choose case if 2*β>1, that is when β >1/2

Faithful partners Payoffs after the outcome (C, D)

The Cheaters unfaithfulness in the first period had triggered the faithful partner to punish him
in the subsequent rounds. She is certain to choose the action of ‘D’ in the next period. She
also knows that her partner who will cooperate in the next round will switch back to ‘D’ if she
continues her ‘D’ after the first period. The expected payoffs for the 2 cases are shown below.

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Case 1: Choosing (., D) and (. D) for the next two periods. The payoffs will be like (3,0), (1,1),
(1,1) ……The average expected payoffs for player 2 is (1- β) *(3+ β + β^2+ β ^3….) =3-2* β.
Case 2: She can express her opinion to forgive her partner and choose ‘C’ after the first period
of Punishment. The payoffs will be like (2,2) (2,2), (2,2) …and so on. The average expected
payoff is (1- β) *(2+2* β +2* β ^2+….) =2
So, the partner has the incentive to choose case 2 if 2 > 3-2* β that is when β >1/2.

Results
The results show that the Cheater will choose to cooperate in the subsequent periods after
his initial deviation from equilibrium given his opponent’s strategy. The faithful partner will
choose to punish the unfaithful one in the first period and will choose to forgive him and
choose ‘C’ given his strategies. So, the game will resort back to the Equilibrium with the
partners agreeing to cooperate and stay in the relationship if their discounting factor is
greater than ½.
The value of Beta may differ for couples across different regions of the world. In countries
where both the partners are financially well-off, the future payoffs from a relationship might
get assigned a higher discounting rate. This may be due to their lesser concern of the
uncertainties of future which will lead them to put a higher value for payoffs that are more
towards the present. A look at the high divorce rate of the high-income countries will help us
see through this angle. There can altogether be a different payoff matrix for couples from
high Income countries, but that is a situation outside the context of our Analysis.

Conclusion

With the Analysis of the long run relationship using Prisoner Dilemma, it is found that the
Strategy profile of (C, C) will be the Subgame perfect Nash Equilibrium and also the Nash
Equilibrium for all the discounting value greater than ½. It can also be reasoned that the
average value of discounting factor Beta will vary across different regions of the world with
respect to their Income. The high number of Divorce cases in developed countries when
compared to the poorer countries also stands as an empirical backing to my argument. The
analysis will stay the same as long the assumed payoffs are same for all the couples.

References

1. https://www.unifiedlawyers.com.au/blog/global-divorce-rates-statistics/

2. https://en.wikipedia.org/wiki/Infidelity

3. https://en.wikipedia.org/wiki/Divorce_demography