Are You better Off Cooperating -- Or Extorting -- in Competition?

Did you know that there's only a small difference between cooperation and egotism, or extortion?

According to a new study, a strategy has been developed that alternates between cooperation and egotism, newswise.com reports.  And apparently it is difficult for us to resist. "The extortion strategy is especially effective when there is strong competitive pressure - that is if there can be only one winner," the web site explains.

"Extortioners often come across as friendly colleagues. They reciprocate friendliness with friendliness, making their competitors feel as though it must be a misunderstanding, if they are taken advantage of again and again. They are forced to play along to avoid loosing even more. This seemingly friendly yet extremely tough exploitation strategy is rewarded with additional gain," points out Manfred Milinski from the Max Planck Institute for Evolutionary Biology in Ploen. 

Together with Lutz Becks at the University of Konstanz, he examined the willingness of human beings to cooperate and exploit under varying conditions.

"Calculations drawn up by scientists show that mutual support can easily turn into extortion," newswise says. "Theorists use the so-called prisoners' dilemma to explore this issue of social interaction among human beings. In this game, two participants will benefit more if they cooperate, than they would if both of them behaved egotistically. However, if one player is egotistic while the other one cooperates, the egotistic player will receive the largest prize, while the cooperating player goes away empty-handed."

This means that cooperating is only worthwhile, if you keep encountering the same player, and are thus able to "punish" previous egotism and reward cooperative behaviour. "For a long time, scientists have considered this type of "tit for tat" strategy to be the most effective behavioural strategy and a recipe for mutual cooperation," newswise asserts.

According to the study, extortion is unbeatable.

In reality, however, many people tend to cooperate less frequently, than is predicted theoretically for the prisoners' dilemma. This discrepancy can be explained by the "extortion" strategy that has been referred to as unbeatable, and was first described by two US researchers in 2012, the web site continues. 

The extortioner takes advantage of the other player systematically, by forcing him to constantly cooperate. In 60 percent of cases, an "extortioner" will react to their counterpart's cooperation by cooperating themselves. In 40 percent of cases they will behave egotistically and collect the maximum prize.

The other person has to comply with the extortioner, because it is the only behaviour that will pay off for them. "They are only able to increase their small gain, by cooperating more and more frequently, in order to benefit in most cases from the extortioner's 60 percent of cooperation. Their gain will increase steadily as a result, but they will cause the extortioner to obtain a much greater prize," the study found.

"Experiments conducted by Manfred Milinski and his team in Ploen showed that human beings actually tend to be encouraged to cooperate and to accede to extortion, when they are playing against a computer that employs the extortion strategy. However, a computer is unimpressed, if its human co-players become increasingly unwilling and refuse to cooperate over the second half of the experiment," newswise states. 

The experiments could therefore not demonstrate whether or not a human extortioner would eventually yield to their competitors' attempts to discipline them, and would return to more cooperative behaviour.

However, if one of the players in a game was additionally enticed with a bonus, this player would turn into an extortioner in many cases. Despite the fact that the other player would keep trying to discipline them by refusing cooperation, the extortioner would resist and cooperate even less rather than more frequently over the course of the experiment. 

Extortioners were also shown to be most successful in the long-term, even in the experiment in which the potential bonus player was not predetermined.

The bonus enabled extortioners to earn even more than cooperative players using a "'generous' strategy, who had no prospect of receiving a bonus. Willingness to cooperate is not a recipe for success, if competitive pressure is strong. Our results show why human beings frequently prove to be less cooperative in real life, than has been predicted in the past," Becks explains.