PLOS One, vol.8 issue 8, August 2013
For many simple games and social interactions, standard game theory techniques (such as analysis of Nash equlibria) lead to predictions that are substantially different from those observed in practical experiments. In particular, co-operation is observed much more often than theory predicts. Various paramaterised theories have been developed to explain that. This is perhaps the first paper that proposes a non-parameterised theory capable of predicting co-operation; and unlike many others, its predictions seem to agree fairly well with observations. Briefly, it proposes that agents imagine taking part in various coalitions rather than acting as independent agents, and choose to act so as to agree with optimistic forecasts from those coalitions.