Fader, Peter and John R. Hauser (1988), "Implicit Coalitions in a Generalized Prisoner's Dilemma," Journal of Conflict Resolution, Vol. 32, No. 3, (September), 553-582.

The presence of a third party can affect attempts by two players to cooperate in a three-player, continuous-alternative, repeated Prisoner's Dilemma-like game. If the third player is uncooperative, two players may find it advantageous to cooperate implicitly, at a level somewhere between full (i.e., three-way) cooperation and full defection. We examine this phenomenon of implicit coalitions via two sequential computer tournaments (38 algorithms in tourney 1, 44 algorithms in tourney 2). In both tournaments, each with a different payoff function, the ability to recognize and/or encourage implicit coalitions seems to be a key indicator of success. This result holds up in a test of robustness. We also examine other properties, including those identified earlier by Axelrod (1980a, 1980b).