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The Evolution of Cooperative Norms: Evidence from a Natural Field Experiment

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  • Bandiera, Oriana
  • Barankay, Iwan
  • Rasul, Imran

Abstract

We document the establishment and evolution of a cooperative norm among workers using evidence from a natural field experiment on a leading UK farm. Workers are paid according to a relative incentive scheme under which increasing individual effort raises a worker's own pay but imposes a negative externality on the pay of all co-workers, thus creating a rationale for cooperation. As a counterfactual, we analyse worker behaviour when workers are paid piece rates and thus have no incentive to cooperate. We find that workers cooperate more as their exposure to the relative incentive scheme increases. We also find that individual and group exposure are substitutes, namely workers who work alongside colleagues with higher exposure cooperate more. Shocks to the workforce in the form of new worker arrivals disrupt cooperation in the short term but are then quickly integrated into the norm. Individual exposure, group exposure, and the arrival of new workers have no effect on productivity when workers and paid piece rates and there is no incentive to cooperate.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5358.

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Date of creation: Nov 2005
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Handle: RePEc:cpr:ceprdp:5358

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Keywords: cooperation; group exercise; individual exposure;

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References

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  1. Noussair, C.N. & Masclet, D. & Tucker, S. & Villeval, M..C, 2003. "Monetary and non-monetary punishment in the voluntary contributions mechanism," Open Access publications from Tilburg University urn:nbn:nl:ui:12-377951, Tilburg University.
  2. Andreoni, James, 1988. "Why free ride? : Strategies and learning in public goods experiments," Journal of Public Economics, Elsevier, vol. 37(3), pages 291-304, December.
  3. Ernst Fehr & Simon Gaechter, 1999. "Cooperation and Punishment in Public Goods Experiments," CESifo Working Paper Series 183, CESifo Group Munich.
  4. J. Ledyard, 1997. "Public Goods: A Survey of Experimental Research," Levine's Working Paper Archive 509, David K. Levine.
  5. Carpenter, Jeffrey P. & Seki, Erika, 2005. "Competitive Work Environments and Social Preferences: Field Experimental Evidence from a Japanese Fishing Community," IZA Discussion Papers 1691, Institute for the Study of Labor (IZA).
  6. Oriana Bandiera & Iwan Barankay & Imran Rasul, 2005. "Social Preferences and the Response to Incentives: Evidence from Personnel Data," The Quarterly Journal of Economics, MIT Press, vol. 120(3), pages 917-962, August.
  7. John List & David Reiley, 2008. "Field experiments," Artefactual Field Experiments 00091, The Field Experiments Website.
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  9. John A. List, 2003. "Does Market Experience Eliminate Market Anomalies?," The Quarterly Journal of Economics, MIT Press, vol. 118(1), pages 41-71, February.
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  12. John A. List, 2003. "Neoclassical Theory Versus Prospect Theory: Evidence from the Marketplace," NBER Working Papers 9736, National Bureau of Economic Research, Inc.
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Cited by:
  1. Donna Harris & Benedikt Herrmann & Andreas Kontoleon, 2009. "`Two's Company, Three's a Group' The impact of group identity and group size on in-group favouritism," Discussion Papers 2009-13, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
  2. Levitt, Steven D. & List, John A., 2009. "Field experiments in economics: The past, the present, and the future," European Economic Review, Elsevier, vol. 53(1), pages 1-18, January.
  3. Jim Engle-Warnick & Andreas Leibbrandt, 2006. "Who Gets The Last Word? An Experimental Study Of The Effect Of A Peer Review Process On The Expression Of Social Norms," Departmental Working Papers 2006-11, McGill University, Department of Economics.
  4. John A. List, 2007. "Field Experiments: A Bridge Between Lab and Naturally-Occurring Data," NBER Working Papers 12992, National Bureau of Economic Research, Inc.
  5. Burks, Stephen V. & Carpenter, Jeffrey P. & Götte, Lorenz & Monaco, Kristen & Porter, Kay & Rustichini, Aldo, 2007. "Using Behavioral Economic Experiments at a Large Motor Carrier: The Context and Design of the Truckers and Turnover Project," IZA Discussion Papers 2789, Institute for the Study of Labor (IZA).
  6. Stephen V. Burks & Jeffrey Carpenter & Lorenz Goette & Kristen Monaco & Aldo Rustichini & Kay Porter, 2007. "Using Behavioral Economic Field Experiments at a Large Motor Carrier: The Context and Design of the Truckers and Turnover Project," NBER Working Papers 12976, National Bureau of Economic Research, Inc.

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