The pen is mightier than the sword: How third-party advice or sanction impact on pro-environmental behavior

It is well recognized that incentives can influence the cooperation of individuals in providing public goods. The aim of this study is to experimentally adapt a Public Good Game (PGG) to the environmental issue of waste management. We report an experiment in which players have to cooperate in order to reduce the cost of waste sorting treatment. We consider a traditional PGG with groups of 4 players, and where an additional player that plays the role of the third-party is introduced in each group in the incentivized treatments. The third-party has either the possibility to advise on the desirable individual contribution (Treatment 1), or to collectively punish the non cooperative behaviors by increasing the tax rate (Treatment 2). Furthermore, participants are asked to perform an effort task to increase their given initial endowments, and a measure of social preferences through a Social Value Orientation test (SVO). We find that both the advice and the threat of sanction increase significantly the average level of individual contributions. However, we see that once the sanction is applied, it has no significant effect in increasing cooperation, quite the contrary. Moreover, we find results in line with (Becker, 1974)'s altruism hypothesis that high income individuals contribute more in absolute value compared to low income ones.(This abstract was borrowed from another version of this item.)