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Voting on Punishment Systems within a Heterogeneous Group

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  • Charles Noussair
  • Fangfang Tan

Abstract

We consider a voluntary contributions game, in which players may punish others after contributions are made and observed. The productivity of contributions, as captured in the marginal-per-capita return, differs among individuals, so that there are two types: high and low productivity. Every two or eight periods, depending on the treatment, individuals vote on a punishment regime, in which certain individuals are permitted, but not required, to have punishment directed toward them. The punishment system can condition on type and contribution history. The results indicate that the most effective regime, in terms of contributions and earnings, is one that allows punishment of low contributors only, regardless of productivity. Nevertheless, only a minority of sessions converge to this system, indicating a tendency for the voting process to lead to suboptimal institutional choice.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2009/wp-cesifo-2009-08/cesifo1_wp2763.pdf
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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2763.

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Date of creation: 2009
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Handle: RePEc:ces:ceswps:_2763

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Keywords: voting; punishment; voluntary contributions; heterogeneity; experiment;

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References

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  1. Masclet, D. & Noussair, C. & Tucker, S. & Villeval, M.C., 2001. "Monetary and Non-monetary Punishment in the Voluntary Contributions Mechanism," Purdue University Economics Working Papers 1141, Purdue University, Department of Economics.
  2. Laurent Denant-Boemont & David Masclet & Charles Noussair, 2007. "Punishment, counterpunishment and sanction enforcement in a social dilemma experiment," Economic Theory, Springer, vol. 33(1), pages 145-167, October.
  3. Ernst Fehr & Simon Gaechter, 1999. "Cooperation and Punishment in Public Goods Experiments," CESifo Working Paper Series 183, CESifo Group Munich.
  4. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  5. Kosfeld, Michael & Okada, Akira & Riedl, Arno, 2006. "Institution Formation in Public Goods Games," IZA Discussion Papers 2288, Institute for the Study of Labor (IZA).
  6. Reuben, Ernesto & Riedl, Arno, 2007. "Public Goods Provision and Sanctioning in Priveleged Groups," Research Memorandum 028, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  7. Haigner, Stefan & Kocher, Martin & Sutter, Matthias, 2006. "Choosing the Stick or the Carrot? Endogenous Institutional Choice in Social Dilemma Situations," CEPR Discussion Papers 5497, C.E.P.R. Discussion Papers.
  8. Anabela Botelho & Glenn W. Harrison & Lígia Pinto & Elisabet E. Rutstrom, 2005. "Social norms and social choice," NIMA Working Papers 30, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  9. Pedro Dal Bó & Andrew Foster & Louis Putterman, 2008. "Institutions and Behavior: Experimental Evidence on the Effects of Democracy," NBER Working Papers 13999, National Bureau of Economic Research, Inc.
  10. Magdalena Margreiter & Matthias Sutter & Dennis Dittrich, 2005. "Individual and Collective Choice and Voting in Common Pool Resource Problem with Heterogeneous Actors," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 32(2), pages 241-271, October.
  11. Ertan, Arhan & Page, Talbot & Putterman, Louis, 2009. "Who to punish? Individual decisions and majority rule in mitigating the free rider problem," European Economic Review, Elsevier, vol. 53(5), pages 495-511, July.
  12. Palfrey, Thomas R & Prisbrey, Jeffrey E, 1997. "Anomalous Behavior in Public Goods Experiments: How Much and Why?," American Economic Review, American Economic Association, vol. 87(5), pages 829-46, December.
  13. Armin Falk & Ernst Fehr & Urs Fischbacher, 2005. "Driving Forces Behind Informal Sanctions," Econometrica, Econometric Society, vol. 73(6), pages 2017-2030, November.
  14. Fangfang Tan, 2008. "Punishment in a Linear Public Good Game with Productivity Heterogeneity," De Economist, Springer, vol. 156(3), pages 269-293, September.
  15. Arhan Ertan & Talbot Page & Louis Putterman, 2005. "Can Endogenously Chosen Institutions Mitigate the Free-Rider Problem and Reduce Perverse Punishment?," Working Papers 2005-13, Brown University, Department of Economics.
  16. Martin Sefton & Robert Shupp & James M. Walker, 2007. "The Effect Of Rewards And Sanctions In Provision Of Public Goods," Economic Inquiry, Western Economic Association International, vol. 45(4), pages 671-690, October.
  17. Matthias Cinyabuguma & Talbot Page & Louis Putterman, 2006. "Can second-order punishment deter perverse punishment?," Experimental Economics, Springer, vol. 9(3), pages 265-279, September.
  18. Nikiforakis, Nikos, 2008. "Punishment and counter-punishment in public good games: Can we really govern ourselves," Journal of Public Economics, Elsevier, vol. 92(1-2), pages 91-112, February.
  19. Stephan Kroll & Todd L. Cherry & Jason F. Shogren, 2007. "Voting, Punishment, And Public Goods," Economic Inquiry, Western Economic Association International, vol. 45(3), pages 557-570, 07.
  20. Brandts, Jordi & Schram, Arthur, 2001. "Cooperation and noise in public goods experiments: applying the contribution function approach," Journal of Public Economics, Elsevier, vol. 79(2), pages 399-427, February.
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Cited by:
  1. Reuben, Ernesto & Riedl, Arno, 2009. "Enforcement of Contribution Norms in Public Good Games with Heterogeneous Populations," IZA Discussion Papers 4303, Institute for the Study of Labor (IZA).
  2. Felix Kolle, 2012. "Heterogeneity and Cooperation in Privileged Groups: The Role of Capability and Valuation on Public Goods Provision," Discussion Papers 2012-07, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  3. Brick, Kerri & Van der Hoven, Zoe & Visser, Martine, 2012. "Cooperation and Climate Change: Can Communication Facilitate the Provision of Public Goods in Heterogeneous Settings?," Discussion Papers dp-12-14-efd, Resources For the Future.
  4. Nikiforakis, Nikos & Noussair, Charles N. & Wilkening, Tom, 2012. "Normative conflict and feuds: The limits of self-enforcement," Journal of Public Economics, Elsevier, vol. 96(9-10), pages 797-807.
  5. Sebastian Prediger, 2011. "How does income inequality affect cooperation and punishment in public good settings?," MAGKS Papers on Economics 201138, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  6. Kerri Brick & Martine Visser, 2012. "Heterogeneity and Voting: A Framed Public Good Experiment," Working Papers 298, Economic Research Southern Africa.

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