Threat and Punishment in Public Good Experiments
AbstractExperimental studies of social dilemmas have shown that while the existence of a sanctioning institution improves cooperation within groups, it also has a detrimental impact on group earnings in the short run. Could the introduction of pre-play threats to punish have enough of a beneficial impact on cooperation, while not incurring the cost associated with actual punishment, so that they increase overall welfare? We report an experiment in which players can issue non-binding threats to punish others based on their contribution levels to a public good. After observing others’ actual contributions, they choose their actual punishment level. We find that threats increase the level of contributions significantly. Efficiency is improved, but only in the long run. However, the possibility of sanctioning differences between threatened and actual punishment leads to lower threats, cooperation and welfare, restoring them to levels equal to or below the levels attained in the absence of threats.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 5206.
Length: 42 pages
Date of creation: Sep 2010
Date of revision:
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Other versions of this item:
- David Masclat & Charles Noussair & Marie-Claire Villeval, 2010. "Threat and Punishment in Public Good Experiments," Working Papers 1019, Groupe d'Analyse et de Théorie Economique (GATE), Centre national de la recherche scientifique (CNRS), Université Lyon 2, Ecole Normale Supérieure.
- David Masclet & Charles N. Noussair & Marie-Claire Villeval, 2011. "Threat and Punishment in Public Good Experiments," CIRANO Working Papers 2011s-08, CIRANO.
- David Masclet & Charles Noussair & Marie Claire Villeval, 2010. "Threat and Punishment in Public Good Experiments," Post-Print halshs-00522655, HAL.
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-10-09 (All new papers)
- NEP-CBE-2010-10-09 (Cognitive & Behavioural Economics)
- NEP-EVO-2010-10-09 (Evolutionary Economics)
- NEP-EXP-2010-10-09 (Experimental Economics)
- NEP-PBE-2010-10-09 (Public Economics)
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