infonet-economy

"Consider a society where all agents initially play fair"" and one agentninvents a cheating"" strategy such as doping in sports. Which factorsndetermine the success of the new cheating strategy? In order to studynthis question we consider an evolutionary game with heterogenous agentsnwho can either play fair or cheat. We model heterogeneity by assumingnthat the players are either high or low types. Three factors determinenthe imitation dynamics of the model: the location and the type of theninnovator, the distribution of types, and the information available to thenagents. In particular we *nd that the economy is more likely to end up inna state where all agents cheat if the innovator is of low type or when thenagents are maximally segregated."