1. Social Behavior- Game Theory and Reciprocity
Georgia De Vito
Berg, J., Dickhaut, J., & Mccabe, K. (1994). Trust, Reciprocity, and Social History. Games and Economic Behavior, Retrieved November 16, 2014, from

2. Video https://www.youtube.com/watch?v=5adPymgvzfo Start at 1:55
Nash equilibrium= a condition in which every participant has optimized its outcome, based on the other players' expected decision.

3. Overview Economic models assume individuals act in own self interest
Make decisions to benefit individual vs. group
Game Theory  should economic models consider individual or group mentality
“Evolutionary models predict the emergence of trust because it maximizes genetic fitness though myopic self interest suggests cheating”

4. Hypothesis and Procedure
Hypotheses
Ma>0 then kb(3Ma)=0
kb(3Ma)>Ma
Double-blind Investment game
Complete anonymity, only play once
Subjects in room A decide how much of $10 to send to subject in room B, which will triple reroute
Subjects in room B then decide how much of received money they will keep or send back to room A
Nash equilibrium predicts no money would be sent
Not the case, why?
Nash equilibrium= a condition in which every participant has optimized its outcome, based on the other players' expected decision.

5. Conclusions from Study
Reciprocity exists as a basic element of human behavior and that this is accounted for in the trust extended to an anonymous counterpart
Self interest alone does not explain results
Shared social history strengthens the relationship between trust and reciprocity
Higher average return growth than average sent money
Internalization of social norms

6. Critical Review Unanswered questions/ unclear
Interesting Notes
People are more trusting than expected
A general shared social history changes behavior to favor group benefit mentality
Including trust and reciprocity would allow for better explanations of economic institutions
Unanswered questions/ unclear
How does gender affect trust/reciprocity?
What if the sender risked personal loss?
Why is trust less dependent on social history than reciprocity?

7. Questions? Thoughts?