 Now we introduce a second complication. Suppose that players’ ability to distinguish defection from cooperation is imperfect. Consider our case of the widget cartel. Suppose the players observe a fall in the market price of widgets. Perhaps this is because a cartel member cheated. Or perhaps it has resulted from an exogenous drop in demand. If tit-for-tat players mistake the second case for the first, they will defect, thereby setting off a chain-reaction of mutual defections from which they can never recover, since every player will reply to the first encountered defection with defection, thereby begetting further defections, and so on.