Effects of individual decision theory assumptions on predictions of cooperation in social dilemmas

Raub and Snijders (1997) show that, under the assumption of S-shaped utilit y, conditions for cooperation in social dilemmas are more restrictive if ou tcomes represent losses than if outcomes represent gains. They neglected tw o interesting issues in their paper: conditions for cooperation in social d ilemmas with both losses and gains as outcomes, and the effect of probabili ty weighing on these conditions. In this paper it is shown that, under assu mptions of Prospect Theory, conditions for cooperation are best if dilemmas include both positive and negative outcomes, and that these conditions imp rove with increasing loss aversion. Furthermore, it is shown that probabili ty weighing can effect conditions to cooperate as well.