Procedural rationality, endogenous sampling, and the instability of defection

We examine cooperation and defection in populations where individuals use both procedural rationality and imitation to choose their strategies. For a broad class of sampling-based choice procedures that encompasses both procedural rationality and imitation, we characterize the conditions under which universal defection is unstable. The results highlight that for cooperation to emerge and persist, the manner in which agents generate and share information can be as important as the underlying payoff incentives.

Coauthored with Srinivas Arigapudi.

Published in the European Economic Review (2026). Link to paper.