Essays on information and cooperation

The goal of my dissertation has two focal points. The first is to understand how cooperation is achieved in non-cooperative game settings with an emphasis on the impact of information aggregation. The second is on the design of mechanisms that induce economic agents to behave cooperatively.;The first essay co-authored with Donald Saari provides the first direct general proof of Sen's classic social choice result which has puzzled economists and social scientists for over three decades. From the geometric proof, we suggest that one way to get around Sen's paradox is to impose a "no strong negative externality" condition. This condition, which can be enforced by law, can be used to design self-enforcing methods. This issue motivates the rest of my dissertation.;In the second essay, I model online trading as a version of the Prisoner's Dilemma game to study what mechanism designs can help deter trade fraud. The focus is on how the reputation mechanism could make an online market self-sustainable. In current online auction markets, only half of buyers leave any feedback after transactions and nearly all comments are positive. In this paper, I propose a mechanism whereby sellers can provide rebates (not necessary in a monetary form) to buyers contingent on the provision of reports by buyers. Using a game theoretical model, I show how the mechanism can increase reporting and induce sellers to behave cooperatively.;The last essay in my dissertation uses data collected from eBay's web site to identify why buyers fail to leave feedback in online markets, especially negative feedback. One potential reason is that it takes more time to leave negative feedback. Another reason buyers may not leave feedback is the fear of retaliation by strategic sellers. My results show that the fear of retaliation is an important reason not to participate. Thus a potential rebate mechanism provides an option for sellers to leave an automatic feedback contingent on receiving payment.