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Punishment and Counter-punishment in Public Goods Games: Can we still govern ourselves?

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Author Info
Nikos Nikiforakis () (Department of Economics, Royal Holloway, University of London)

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Abstract

Recent public goods experiments have shown that free riding can be curtailed through mutual monitoring and sanctioning between members of a group. However, often we can not allow for punishment and exclude the possibility of counter-punishment occurring. We design a public goods experiment, where we allow for both punishment and counter-punishment. We find that in both partner and stranger treatments cooperation declines over time. The reason is that people are less willing to punish under the threat of counter-punishment. Participants squander their endowment in costly confrontations leading to a relative payoff loss, in comparison to a treatment without punishments.

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File URL: http://www.rhul.ac.uk/economics/Research/WorkingPapers/pdf/dpe0405.pdf
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Publisher Info
Paper provided by Department of Economics, Royal Holloway University of London in its series Royal Holloway, University of London: Discussion Papers in Economics with number 04/05.

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Length: 34 pages
Date of creation: Apr 2004
Date of revision: Apr 2004
Handle: RePEc:hol:holodi:0405

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Related research
Keywords: public goods; punishment; counter-punishment; mutual monitoring; free-riding; experiments;

Other versions of this item:

Find related papers by JEL classification:
C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
D64 - Microeconomics - - Welfare Economics - - - Altruism

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Ernst Fehr & Simon Gachter & Georg Kirchsteiger, 1997. "Reciprocity as a Contract Enforcement Device: Experimental Evidence," Econometrica, Econometric Society, vol. 65(4), pages 833-860, July.
  2. Ernst Fehr & Simon Gachter, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September. [Downloadable!] (restricted)
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  3. David Masclet & Charles Noussair & Steven Tucker & Marie-Claire Villeval, 2003. "Monetary and Nonmonetary Punishment in the Voluntary Contributions Mechanism," American Economic Review, American Economic Association, vol. 93(1), pages 366-380, March. [Downloadable!]
    Other versions:
  4. Samuel Bowles & Herbert Gintis, 2002. "Social Capital and Community Governance," Economic Journal, Royal Economic Society, vol. 112(483), pages 419-436, November. [Downloadable!] (restricted)
    Other versions:
  5. Jeffrey Carpenter, 2002. "The Demand for Punishment," Middlebury College Working Paper Series 0243, Middlebury College, Department of Economics. [Downloadable!]
    Other versions:
  6. Ernst Fehr & Simon Gaechter, 2003. "Altruistic Punishment in Humans," Microeconomics 0305006, EconWPA. [Downloadable!]
  7. Camerer, Colin F & Thaler, Richard H, 1995. "Ultimatums, Dictators and Manners," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 209-19, Spring. [Downloadable!] (restricted)
  8. Herbert Gintis, 2000. "Strong Reciprocity and Human Sociality," Working Papers 2000-02, University of Massachusetts Amherst, Department of Economics. [Downloadable!]
  9. Martin Sefton & Robert Shupp & James M. Walker, 2006. "The Effect of Rewards and Sanctions in Provision of Public Goods," Caepr Working Papers 2006-005, Center for Applied Economics and Policy Research, Economics Department, Indiana University Bloomington, revised Aug 2006. [Downloadable!]
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  10. Dufwenberg, Martin & Gneezy, Uri, 2000. "Price competition and market concentration: an experimental study," International Journal of Industrial Organization, Elsevier, vol. 18(1), pages 7-22, January. [Downloadable!] (restricted)
  11. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. 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. [Downloadable!]
  2. Simon Gaechter & Benedikt Herrmann, 2006. "The limits of self-governance in the presence of spite: Experimental evidence from urban and rural Russia," Discussion Papers 2006-13, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham. [Downloadable!]
    Other versions:
  3. Marco Casari, 2005. "On the Design of Peer Punishment Experiments," Experimental Economics, Springer, vol. 8(2), pages 107-115, June. [Downloadable!] (restricted)
    Other versions:
  4. Nikos Nikiforakis & Hans-Theo Normann, 2005. "A Comparative Statics Analysis of Punishment in Public-Good Experiments," Royal Holloway, University of London: Discussion Papers in Economics 05/07, Department of Economics, Royal Holloway University of London, revised Jun 2005. [Downloadable!]
    Other versions:
  5. Jeffrey Carpenter & Peter Hans Matthews, 2007. "What Norms Trigger Punishment," Middlebury College Working Paper Series 0708, Middlebury College, Department of Economics. [Downloadable!]
    Other versions:
  6. Klaus Abbink & Jordi Brandts & Benedikt Herrmann & Henrik Orzen, 2009. "Inter-Group Conflict and Intra-Group Punishment in an Experimental Contest Game," Discussion Papers 2009-03, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham. [Downloadable!]
    Other versions:
  7. Marco Casari & Luigi Luini, 2005. "Group Cooperation Under Alternative Peer Punishment Technologies: An Experiment," Labsi Experimental Economics Laboratory University of Siena 002, University of Siena. [Downloadable!]
    Other versions:
  8. Talbot Page & Louis Putterman & Bruno Garcia, 2008. "Getting Punnishment Right: Do Costly Monitoring or Redustributive Punishment Help?," Working Papers 2008-1, Brown University, Department of Economics. [Downloadable!]
  9. Visser, Martine & Burns, Justine, 2006. "Bridging the Great Divide in South Africa: Inequality and Punishment in the Provision of Public Goods," Working Papers in Economics 219, Göteborg University, Department of Economics. [Downloadable!]
  10. 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. [Downloadable!] (restricted)
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