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Intermediation Reduces Punishment (and Reward)

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  • Lucas C. Coffman

Abstract

This paper shows moral decision making is not well predicted by the overall fairness of an act but rather by the fairness of the consequences that follow directly. In laboratory experiments, third-party punishment for keeping money from a poorer player decreases when an intermediary actor is included in the transaction. This is true for completely passive intermediaries, even though intermediation decreases the payout of the poorest player and hurts equity, and because intermediation distances the transgressor from the outcome. A separate study shows rewards of charitable giving decrease when the saliency of an intermediary is increased. (JEL A13, D63, D64)

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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Journal: Microeconomics.

Volume (Year): 3 (2011)
Issue (Month): 4 (November)
Pages: 77-106

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Handle: RePEc:aea:aejmic:v:3:y:2011:i:4:p:77-106

Note: DOI: 10.1257/mic.3.4.77
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  1. Matthew Rabin., 1992. "Incorporating Fairness into Game Theory and Economics," Economics Working Papers 92-199, University of California at Berkeley.
  2. Ernst Fehr & Urs Fischbacher, . "Third Party Punishment and Social Norms," IEW - Working Papers 106, Institute for Empirical Research in Economics - University of Zurich.
  3. Simon Gachter & Ernst Fehr, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September.
  4. Stefano DellaVigna & John A. List & Ulrike Malmendier, 2012. "Testing for Altruism and Social Pressure in Charitable Giving," The Quarterly Journal of Economics, Oxford University Press, vol. 127(1), pages 1-56.
  5. Armin Falk & Ernst Fehr & Urs Fischbacher, 2005. "Driving Forces Behind Informal Sanctions," Econometrica, Econometric Society, vol. 73(6), pages 2017-2030, November.
  6. Urs Fischbacher & Simon Gaechter & Ernst Fehr, . "Are People Conditionally Cooperative? Evidence from a Public Goods Experiment," IEW - Working Papers 016, Institute for Empirical Research in Economics - University of Zurich.
  7. Kahneman, Daniel & Knetsch, Jack L & Thaler, Richard H, 1986. "Fairness and the Assumptions of Economics," The Journal of Business, University of Chicago Press, vol. 59(4), pages S285-300, October.
  8. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  9. David K. Levine, 1998. "Modeling Altruism and Spitefulness in Experiment," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 1(3), pages 593-622, July.
  10. Charness, Gary B, 1999. "Responsibility And Effort In An Experimental Labor Market," University of California at Santa Barbara, Economics Working Paper Series qt7x98w91h, Department of Economics, UC Santa Barbara.
  11. Alvin E. Roth, 2007. "Repugnance as a Constraint on Markets," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 37-58, Summer.
  12. John R. Hamman & George Loewenstein & Roberto A. Weber, 2010. "Self-Interest through Delegation: An Additional Rationale for the Principal-Agent Relationship," American Economic Review, American Economic Association, vol. 100(4), pages 1826-46, September.
  13. Axel Ockenfels & Gary E. Bolton, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March.
  14. Grossman, Zachary, 2010. "Self-Signaling Versus Social-Signaling in Giving," University of California at Santa Barbara, Economics Working Paper Series qt7320x2cp, Department of Economics, UC Santa Barbara.
  15. Gary Charness, 2004. "Attribution and Reciprocity in an Experimental Labor Market," Journal of Labor Economics, University of Chicago Press, vol. 22(3), pages 665-688, July.
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