IDEAS home Printed from https://ideas.repec.org/a/aea/aejmic/v3y2011i4p77-106.html
   My bibliography  Save this article

Intermediation Reduces Punishment (and Reward)

Author

Listed:
  • 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)

Suggested Citation

  • Lucas C. Coffman, 2011. "Intermediation Reduces Punishment (and Reward)," American Economic Journal: Microeconomics, American Economic Association, vol. 3(4), pages 77-106, November.
    • Handle: RePEc:aea:aejmic:v:3:y:2011:i:4:p:77-106
    Note: DOI: 10.1257/mic.3.4.77
    as

    Download full text from publisher

    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/mic.3.4.77
    Download Restriction: no
    File URL: http://www.aeaweb.org/aej/mic/data/2010-0151_data.zip
    Download Restriction: no
    File URL: http://www.aeaweb.org/aej/mic/app/2010-0151_app.pdf
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    ---><---

    References listed on IDEAS

    as
    1. Dirk Engelmann & Martin Strobel, 2004. "Inequality Aversion, Efficiency, and Maximin Preferences in Simple Distribution Experiments," American Economic Review, American Economic Association, vol. 94(4), pages 857-869, September.
    2. Gary Charness & Matthew Rabin, 2002. "Understanding Social Preferences with Simple Tests," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(3), pages 817-869.
    3. Ernst Fehr & Urs Fischbacher, "undated". "Third Party Punishment and Social Norms," IEW - Working Papers 106, Institute for Empirical Research in Economics - University of Zurich.
    4. Charness, Gary & Rabin, Matthew, 2005. "Expressed preferences and behavior in experimental games," Games and Economic Behavior, Elsevier, vol. 53(2), pages 151-169, November.
    5. 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.
    6. Andreoni, James & Croson, Rachel, 2008. "Partners versus Strangers: Random Rematching in Public Goods Experiments," Handbook of Experimental Economics Results, in: Charles R. Plott & Vernon L. Smith (ed.), Handbook of Experimental Economics Results, edition 1, volume 1, chapter 82, pages 776-783, Elsevier.
    7. Armin Falk & Ernst Fehr & Urs Fischbacher, 2005. "Driving Forces Behind Informal Sanctions," Econometrica, Econometric Society, vol. 73(6), pages 2017-2030, November.
    8. 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.
    9. Gary E Bolton & Jordi Brandts & Axel Ockenfels, 2005. "Fair Procedures: Evidence from Games Involving Lotteries," Economic Journal, Royal Economic Society, vol. 115(506), pages 1054-1076, October.
    10. Stefano DellaVigna & John A. List & Ulrike Malmendier, 2012. "Testing for Altruism and Social Pressure in Charitable Giving," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 127(1), pages 1-56.
    11. 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.
    12. Alvin E. Roth, 2007. "Repugnance as a Constraint on Markets," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 37-58, Summer.
    13. Claudia Keser & Frans Van Winden, 2000. "Conditional Cooperation and Voluntary Contributions to Public Goods," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(1), pages 23-39, March.
    14. 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 285-300, October.
    15. Jason Dana & Roberto Weber & Jason Kuang, 2007. "Exploiting moral wiggle room: experiments demonstrating an illusory preference for fairness," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 33(1), pages 67-80, October.
    16. 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.
    17. Rabin, Matthew, 1993. "Incorporating Fairness into Game Theory and Economics," American Economic Review, American Economic Association, vol. 83(5), pages 1281-1302, December.
    18. Daylian M. Cain & George Loewenstein & Don A. Moore, 2005. "The Dirt on Coming Clean: Perverse Effects of Disclosing Conflicts of Interest," The Journal of Legal Studies, University of Chicago Press, vol. 34(1), pages 1-25, January.
    19. Fischbacher, Urs & Gachter, Simon & Fehr, Ernst, 2001. "Are people conditionally cooperative? Evidence from a public goods experiment," Economics Letters, Elsevier, vol. 71(3), pages 397-404, June.
    20. 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.
    21. Johansson, Lars-Olof & Svedsäter, Henrik, 2009. "Piece of cake? Allocating rewards to third parties when fairness is costly," Organizational Behavior and Human Decision Processes, Elsevier, vol. 109(2), pages 107-119, July.
    22. 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 1826-1846, September.
    23. Paharia, Neeru & Kassam, Karim S. & Greene, Joshua D. & Bazerman, Max H., 2009. "Dirty work, clean hands: The moral psychology of indirect agency," Organizational Behavior and Human Decision Processes, Elsevier, vol. 109(2), pages 134-141, July.
    24. Martin, Kenneth J. & Thomas, Randall S., 2005. "When is enough, enough? Market reaction to highly dilutive stock option plans and the subsequent impact on CEO compensation," Journal of Corporate Finance, Elsevier, vol. 11(1-2), pages 61-83, March.
    25. Charness, Gary, 2000. "Responsibility and effort in an experimental labor market," Journal of Economic Behavior & Organization, Elsevier, vol. 42(3), pages 375-384, July.
    26. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer;Economic Science Association, vol. 10(2), pages 171-178, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Erik O. Kimbrough & Alexander Vostroknutov, 2016. "Norms Make Preferences Social," Journal of the European Economic Association, European Economic Association, vol. 14(3), pages 608-638, June.
    2. Leibbrandt, Andreas & López-Pérez, Raúl & Spiegelman, Eli, 2023. "Reciprocal, but inequality averse as well? Mixed motives for punishment and reward," Journal of Economic Behavior & Organization, Elsevier, vol. 210(C), pages 91-116.
    3. Kurt A. Ackermann & Ryan O. Murphy, 2019. "Explaining Cooperative Behavior in Public Goods Games: How Preferences and Beliefs Affect Contribution Levels," Games, MDPI, vol. 10(1), pages 1-34, March.
    4. Reuben, Ernesto & Riedl, Arno, 2013. "Enforcement of contribution norms in public good games with heterogeneous populations," Games and Economic Behavior, Elsevier, vol. 77(1), pages 122-137.
    5. Zachary Grossman, 2014. "Strategic Ignorance and the Robustness of Social Preferences," Management Science, INFORMS, vol. 60(11), pages 2659-2665, November.
    6. Björn Bartling & Urs Fischbacher, 2012. "Shifting the Blame: On Delegation and Responsibility," Review of Economic Studies, Oxford University Press, vol. 79(1), pages 67-87.
    7. Fluet, Claude & Galbiati, Rpbertp, 2016. "Lois et normes : les enseignements de l'économie comportementale," L'Actualité Economique, Société Canadienne de Science Economique, vol. 92(1-2), pages 191-215, Mars-Juin.
    8. Charness, Gary & Rabin, Matthew, 2005. "Expressed preferences and behavior in experimental games," Games and Economic Behavior, Elsevier, vol. 53(2), pages 151-169, November.
    9. Bartling, Björn & Grieder, Manuel & Zehnder, Christian, 2017. "Competitive pricing reduces wasteful counterproductive behaviors," Journal of Public Economics, Elsevier, vol. 156(C), pages 34-47.
    10. Mengjie Wang, 2017. "Does strategy fairness make inequality more acceptable?," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 17-08, School of Economics, University of East Anglia, Norwich, UK..
    11. Fehr, Ernst & Schmidt, Klaus M., 2005. "The Economics of Fairness, Reciprocity and Altruism – Experimental Evidence and New Theories," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 66, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
    12. Friehe, Tim & Utikal, Verena, 2018. "Intentions under cover – Hiding intentions is considered unfair," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 73(C), pages 11-21.
    13. Charness, Gary & Kuhn, Peter, 2011. "Lab Labor: What Can Labor Economists Learn from the Lab?," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 3, pages 229-330, Elsevier.
    14. Leibbrandt, Andreas & López-Pérez, Raúl, 2012. "An exploration of third and second party punishment in ten simple games," Journal of Economic Behavior & Organization, Elsevier, vol. 84(3), pages 753-766.
    15. Bicskei, Marianna & Lankau, Matthias & Bizer, Kilian, 2016. "Negative reciprocity and its relation to anger-like emotions in identity-homogeneous and -heterogeneous groups," Journal of Economic Psychology, Elsevier, vol. 54(C), pages 17-34.
    16. López-Pérez, Raúl, 2008. "Aversion to norm-breaking: A model," Games and Economic Behavior, Elsevier, vol. 64(1), pages 237-267, September.
    17. Croson, Rachel & Konow, James, 2007. "Double Standards: Social Preferences and Moral Biases," MPRA Paper 2729, University Library of Munich, Germany.
    18. Brownback, Andy & Kuhn, Michael A., 2019. "Understanding outcome bias," Games and Economic Behavior, Elsevier, vol. 117(C), pages 342-360.
    19. Bruttel, Lisa & Stolley, Florian, 2020. "Getting a yes. An experiment on the power of asking," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 86(C).
    20. Snir, Avichai, 2014. "When choosing to be almost certain of winning can be better than choosing to win with certainty," European Journal of Political Economy, Elsevier, vol. 36(C), pages 135-146.

    More about this item

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

    Lists

    This item is featured on the following reading lists, Wikipedia, or ReplicationWiki pages:
    1. Intermediation Reduces Punishment (and Reward) (AEJ:MI 2011) in ReplicationWiki

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aejmic:v:3:y:2011:i:4:p:77-106. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.