Rewards and the evolution of cooperation in public good games

Abstract: Properly coordinating cooperation is relevant for resolving public good problems such as clean energy and environmental protection. However, little is known about how individuals can coordinate themselves for a certain level of cooperation in large populations of strangers. In a typical situation, a consensus-building process hardly succeeds due to lack of face and standing. The evolution of cooperation in this type of situation is studied using threshold public good games in which cooperation prevails when it is initially sufficient, or otherwise, it perishes. While punishment is a powerful tool to shape human behaviours, institutional punishment is often too costly to start with only a few contributors, which is another coordination problem. Here we show that whatever the initial conditions, reward funds based on voluntary contribution can evolve. The voluntary reward paves the way for effectively overcoming the coordination problem and efficiently transforms freeloaders to cooperators with a perceived small risk of collective failure.