Emergence of Reputation-Based Cooperation in LLM Agents

Can cooperation among large language model (LLM) agents be evolutionarily stable against free-rider invasion? We study an indirect reciprocity donation game where LLM agents observe behavioral traces and donate on a continuous scale. Strategies, represented as natural language prompts, evolve through cultural transmission across generations. Across four LLM backends, robustness to free-rider invasion varies by more than an order of magnitude. The strongest predictor of this robustness is opponent endowment sensitivity, the degree to which agents discriminate between cooperative and uncooperative opponents, operationalizing the classical Image Scoring mechanism. By contrast, adherence to the Leading-Eight L1 norm does not predict robustness. Robustness depends on defector exclusion: while both cooperator reward and defector punishment vary across models, only the stringency of defector exclusion predicts resistance to free-rider invasion. These findings reveal that LLM agents are confined to Image Scoring-like discrimination and fail to develop the more robust Leading-Eight norms, highlighting a fundamental vulnerability in culturally evolved LLM cooperation and motivating bottom-up approaches to norm construction.