Emergence of Cooperation Using Commitments and Complex Network Dynamics

In this paper, our goal is to achieve the emergence of cooperation in self-interested agent societies operating on highly connected scale-free networks. The novelty of this work is that agents are able to control topological features during the network formation phase. We propose a commitment-based dynamic coalition formation approach that result in a single coalition where agents mutually cooperate. Agents play an iterated Prisoner´s Dilemma game with their immediate neighbors and offer commitments to their wealthiest neighbors in order to form coalitions. A commitment proposal, that includes a high breaching penalty, incentivizes opponent agents to form coalitions within which they mutually cooperate and thereby increase their payoff. We have analytically determined, and experimentally substantiated, how the value of the penalty should be set with respect to the minimum node degree and the payoff values such that convergence into optimal coalitions is possible. Using a computational model, we determine an appropriate partner selection strategy for the agents that results in a network facilitating the convergence into a single coalition and thereby maximizing average expected payoff.