Evolution of cooperation with joint liability

Abstract

‘Personal responsibility’, one of the basic principles of social governance, requires one to be accountable for what one does. However, personal responsibility is far from the only norm ruling human interactions, especially in social and economic activities. In many collective communities such as among enterprise colleagues and family members, one’s personal interests are often bound to others’—once one member breaks the rule, a group of people have to bear the punishment or sanction. Such a mechanism is termed ‘joint liability’. Although many real-world cases have evidenced that joint liability can help to maintain collective collaboration, a deep and systematic theoretical analysis on how and when it promotes cooperation remains lacking. Here, we use evolutionary game theory to model an interacting system with joint liability, where one’s losing credit could deteriorate the reputation of the whole group. We provide the analytical condition to predict when cooperation evolves and analytically prove that in the presence of punishment, being jointly liable greatly promotes cooperation. Our work stresses that joint liability is of great significance in promoting current economic prosperity.