Endogenous rewards promote cooperation

Area of Science:

• Social sciences
• Biological sciences
• Game theory

Background:

• Sustaining cooperation in social dilemmas is crucial.
• Punishment in public goods games (PGG) promotes cooperation but has drawbacks.
• Resource destruction and social capital loss are disadvantages of punishment.

Purpose of the Study:

• To propose and evaluate an endogenous reward mechanism for PGG.
• To promote cooperation efficiently without negative consequences.
• To achieve sustainable cooperation with budget-balanced rewards.

Main Methods:

• Developed an endogenous reward mechanism taxing PGG income.
• Players distribute shares of the fund as rewards.
• Simulations used type-specific estimations and conditional cooperation models.

Main Results:

• The reward mechanism reversed the decay trend in cooperation.
• High levels of contribution were achieved.
• Budget-balanced rewards required no external funding.

Conclusions:

• Endogenous rewards offer an efficient alternative to punishment in PGG.
• The proposed mechanism sustains cooperation and conserves resources.
• Payoff-based conditional cooperation explains observed effects.