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Trigger-happy or precisionist? On demand for monitoring in peer-based public goods provision

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  • Nicklisch, Andreas
  • Putterman, Louis
  • Thöni, Christian

Abstract

Recent studies question whether societies can self-govern public goods dilemmas with the help of decentralized punishment opportunities. One important challenge is imperfect information about individuals’ contributions. In laboratory experiments, imperfect information increases misdirected punishment and thereby hampers the efficacy of the punishment mechanism. A key question is thus whether those facing such a collective action dilemma would punish despite doubt if they could observe one another’s actions more accurately at some cost. We find that most experimental subjects prefer to engage in costly monitoring before punishing, or else not to punish at all. We demonstrate a price sensitive demand for monitoring, a tendency of known monitoring to serve as a warning of punishment, a taste-based preference for full over partial monitoring, and positive effects of monitoring on cooperation and efficiency.

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  • Nicklisch, Andreas & Putterman, Louis & Thöni, Christian, 2021. "Trigger-happy or precisionist? On demand for monitoring in peer-based public goods provision," Journal of Public Economics, Elsevier, vol. 200(C).
    • Handle: RePEc:eee:pubeco:v:200:y:2021:i:c:s0047272721000657
    DOI: 10.1016/j.jpubeco.2021.104429
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    References listed on IDEAS

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    Cited by:

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    2. Goeschl, Timo & Haberl, Beatrix & Soldà, Alice, 2023. "How to Organize Monitoring and Punishment: Experimental Evidence," Working Papers 0737, University of Heidelberg, Department of Economics.

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    More about this item

    Keywords

    Public goods; Peer punishment; Costly monitoring;
    All these keywords.

    JEL classification:

    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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