Acknowledging the social functions of emotion in people, there has been growing interest in the interpersonal effect of emotion on cooperation in social dilemmas. This paper explores whether and how facial displays of emotion in embodied agents impact cooperation with human users. The paper describes an experiment where participants play the iterated prisoner's dilemma against two different agents that play the same strategy (tit-for-tat), but communicate different goal orientations (cooperative vs. individualistic) through their patterns of facial displays. The results show that participants are sensitive to differences in the displays of emotion and cooperate significantly more with the cooperative agent. The results also reveal that cooperation rates are only significantly different when people play first with the individualistic agent. This is in line with the well-known black-hat/white-hat effect from the negotiation literature. However, this study emphasizes that people can discern a cooperator (white-hat) from a noncooperator (black-hat) based only on emotion displays. We propose that people are able to identify the cooperator by inferring, from the emotion displays, the agent's goals. We refer to this as reverse appraisal, as it reverses the usual process in which appraising relevant events with respect to one's goals leads to specific emotion displays. We discuss implications for designing human–computer interfaces and understanding human–human interaction.

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