Cooperative diversity protocols are designed with the assumption that terminals always help each other in a socially efficient manner. This assumption may not be valid in commercial wireless networks where terminals may misbehave for selfish or malicious intentions. The presence of misbehaving terminals creates a social-dilemma where terminals exhibit uncertainty about the cooperative behavior of other terminals in the network. Cooperation in social-dilemma is characterized by a sub-optimal Nash equilibrium where wireless terminals opt out of cooperation. Hence, without establishing a mechanism to detect and mitigates effects of misbehavior, it is difficult to maintain a socially optimal cooperation. In this paper, we analyze effects of misbehavior based on game theoretic approaches. We show using evolutionary game theory, the permeation of selfish behavior in cooperative diversity. Our main goal is to design a mechanism that would enable wireless terminals to select reliable partners in the presence of uncertainty. To this end, we characterize cooperative diversity within the framework of a dynamic game with incomplete information. We introduce a reputation mechanism which would lead to a perfect Bayesian equilibrium.