Rational behaviour and cooperation degree in competitive situations

Decision makers in competitive situations care not only about their own int erests but also the interests of their opponents to keep or improve their c ompetitiveness. They have incentives to take cooperative actions as well as non-cooperative actions, depending on the results caused by the actions. T hese features make traditional game theory inadequate in describing competi tors' rational behaviour. This paper first proposes a general framework for analysing decision makers' rational behaviour in multiperson decision situ ations, and then uses it to model rational behaviour in two-player competit ive situations. To characterize competitive situations quantitatively, the notion of cooperation degree is formalized. By focusing on a typical two-pl ayer competitive situation, relations between cooperation degree and compet itors' subjective factors are explored.