Ali Ozkes
IBD Salle 21
AMU - AMSE
5-9 boulevard Maurice Bourdet
13001 Marseille
Ugo Bolletta: ugo.bolletta2[at]unibo.it
Mathieu Faure: mathieu.faure[at]univ-amu.fr
We study the determinants of cooperative behavior in two-person finitely repeated games with a Pareto-inefficient Nash equilibrium. We replicate previous experimental results on tacit collusion that suggest higher levels of cooperation under strategic complementarity than under strategic substitution. We argue that this can be explained by the cognitive hierarchy theory and emphasize also the risks involved in unilateral cooperation and the temptation to defect unilaterally. When communication is allowed, however, the effect of strategic environment is not present. We also study the relevance of cognitive skills in cooperation and find that cognitive skills are, in general, positively correlated with cooperative behavior and furthermore, assortative matching of skills might induce more cooperation than mixed matching. Finally, we employ natural language processing tools to investigate how subjects' communications are shaped in relation to the strategic environment and subjects' cognitive skills. We propose the use of topic models to analyze chat records in experimental games to infer about the cooperative, or in general, strategic behavior in the lab.