A Comparative Statics Analysis of Punishment in Public-Good Experiments
AbstractThis paper provides a comparative statics analysis of punishment in public-good experiments. We vary systematically the effectiveness of punishment, that is, the factor by which punishment reduces the punished player’s income, and we find that contributions to the public good increase monotonically in effectiveness. High effectiveness leads to near complete contribution rates and welfare improvements. Below a certain threshold, however, punishment cannot prevent the decay of cooperation found in the public-good game without punishment. In these cases, the possibility to punish may even worsen welfare. Finally, we show that punishment is a normal and inferior good.
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Bibliographic InfoPaper provided by Department of Economics, Royal Holloway University of London in its series Royal Holloway, University of London: Discussion Papers in Economics with number 05/07.
Length: 22 pages
Date of creation: Jun 2005
Date of revision: Jun 2005
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Other versions of this item:
- Nikos Nikiforakis & Hans-Theo Normann, 2008. "A comparative statics analysis of punishment in public-good experiments," Experimental Economics, Springer, vol. 11(4), pages 358-369, December.
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
- D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
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Working Paper Series of the Max Planck Institute for Research on Collective Goods
2009_20, Max Planck Institute for Research on Collective Goods.
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- Nikos Nikiforakis & Hans-Theo Normann & Brian Wallace, 2007. "Asymmetric Enforcement of Cooperation in a Social Dilemma," Department of Economics - Working Papers Series 982, The University of Melbourne.
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