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Mutual Monitoring in Teams: Theory and Experimental Evidence on the Importance of Reciprocity

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Author Info
Jeffery Carpenter ()
Samuel Bowles
Herbert Gintis

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Abstract

Monitoring by peers is often an effective means of attenuating incentive problems. Most explanations of the efficacy of mutual monitoring rely either on small group size or on a version of the Folk theorem with repeated interactions which requires reasonably accurate public information concerning the behavior of each player. We provide a model of team production in which the effectiveness of mutual monitoring depends not on these factors, but rather on strong reciprocity: the willingness of some team members to engage in the costly punishment of shirkers. This alternative does not require small group size or public signals. An experimental public goods game provides evidence for the behavioral relevance of strong reciprocity in teams.

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Paper provided by Middlebury College, Department of Economics in its series Middlebury College Working Paper Series with number 0608.

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Length: 25 pages
Date of creation: Aug 2006
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Handle: RePEc:mdl:mdlpap:0608

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  5. Jeffrey Carpenter & Peter Hans Matthews, 2005. "Norm Enforcement: Anger, Indignation or Reciprocity?," Middlebury College Working Paper Series 0503, Middlebury College, Department of Economics. [Downloadable!]
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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. Stefan Grosse & Louis Putterman & Bettina Rockenbach, 2007. "Monitoring In Teams: A Model and Experiment on the Central Monitor Hypothesis," Working Papers 2007-4, Brown University, Department of Economics. [Downloadable!]
  2. Agnès Festré & Pierre Garrouste, 2009. "The economic analysis of social norms: A reappraisal of Hayek’s legacy," The Review of Austrian Economics, Springer, vol. 22(3), pages 259-279, September. [Downloadable!] (restricted)
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  3. Jeffrey Carpenter & Peter Hans Matthews, 2007. "What Norms Trigger Punishment," Middlebury College Working Paper Series 0708, Middlebury College, Department of Economics. [Downloadable!]
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  4. 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!]
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  5. Simon Gaechter & Benedikt Herrmann, 2007. "The limits of self-governance when cooperators get punished: Experimental evidence from urban and rural Russia," Discussion Papers 2007-11, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham. [Downloadable!]
  6. Timothy N. Cason & Lata Gangadharan & Pushkar Maitra, 2008. "Moral Hazard and Peer Monitoring in a Laboratory Microfinance Experiment," Purdue University Economics Working Papers 1208, Purdue University, Department of Economics. [Downloadable!]
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