Just a general comment that humans and most other social animals have evolved internal mechanisms for correcting the PD-type payoff matrix even in absence of an external threat of punishment for defection. We often call it “honor” or “conscience”. It is not foolproof, but it tends to function well enough to prevent the ingroup collapse.
Scott Alexander’s “Meditations on Moloch” presents several examples of PD-type scenarios in which honor/conscience-style mechanisms fail. Generally, honor and conscience simply provide additive terms to the entry of the payoff matrix. These mechanisms can shift the N.E. to a different location, but don’t guarantee that the resulting N.E. will not produce negative effects of other types. This post was mainly meant to provide a (hopefully) intuitive explanation of N.E.
Just a general comment that humans and most other social animals have evolved internal mechanisms for correcting the PD-type payoff matrix even in absence of an external threat of punishment for defection. We often call it “honor” or “conscience”. It is not foolproof, but it tends to function well enough to prevent the ingroup collapse.
Scott Alexander’s “Meditations on Moloch” presents several examples of PD-type scenarios in which honor/conscience-style mechanisms fail. Generally, honor and conscience simply provide additive terms to the entry of the payoff matrix. These mechanisms can shift the N.E. to a different location, but don’t guarantee that the resulting N.E. will not produce negative effects of other types. This post was mainly meant to provide a (hopefully) intuitive explanation of N.E.