new study shows that if the reputation of everyone in a network is completely transparent – made common knowledge and visible to all – rather than limited to the individuals who are directly connected, the level of cooperation across the overall network almost doubles. The network also becomes denser and more clustered (so your connections tend to be connected with each other).
The researchers also tested how transparency of social connections in the group influences cooperation. On its own, common knowledge of social connections had little impact on overall levels of cooperation.
However, when the researchers combined transparency of social connections with transparency of everyone’s reputation, a community of the most cooperative formed. Members of the community actively removed links from less cooperative individuals and refused their proposals to reconnect.
Researchers found that belonging to the community of cooperators is profitable. Each interaction in the cooperative community is 23% more beneficial than the equivalent interaction in the less cooperative community.
“We show that knowing others’ past actions is the key driver of a high contribution level. Additionally, knowing who is connected to whom matters for the distribution of contributions: it allows contributors to form their own community,”
“This finding suggests that in a world where social information is more available, people may increasingly insulate themselves in communities with other like-minded individuals. In the case we examined, belonging to the community of contributors is highly beneficial,”
When the reputation (previous actions) of everyone in the network was rendered transparent, the overall levels of cooperation were almost twice as high as when only the previous actions of immediate connections were known.
When the social connections for the entire network were also revealed to all, the cooperators formed their own community, leaving those with a history of being uncooperative out in the cold.
Gallo points out that whether the community formation – the insulating and ostracizing – that occurred in the transparent network is a desirable outcome depends on the nature of the behaviour that leads to the separation.
“In the experiment, the ‘good’ cooperators ostracize the ‘bad’ defectors, but one can argue the defectors brought it on themselves with their actions. If the same pattern occurred because of another more neutral behaviour, like an accent when speaking a language, then the ostracization might be undesirable for society,”