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Sanctions that Signal: an Experiment

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Sanctions are a means to provide incentives towards more pro-social behavior. Yet their implementation can be a signal that past behavior was undesirable. We investigate experimentally the importance of the informational content of the choice to sanction. We place this in a context of a coordination game to focus attention on beliefs and information and less on intrinsic or pro-social motivations. We compare the e ect of sanctions that are introduced exogenously by the experimenter to that of sanctions which have been actively chosen by a subject who takes the role of a fictitious policy maker with superior information about the previous e ort of the other players. We nd that cooperative subjects perceive actively chosen sanctions as a negative signal which eliminates for them the incentive e ect of sanctions.

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Paper provided by University of Vienna, Department of Economics in its series Vienna Economics Papers with number 1107.

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Date of creation: Mar 2011
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Handle: RePEc:vie:viennp:1107

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Web page: http://www.univie.ac.at/vwl

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Cited by:
  1. Galbiati, Roberto & Vertova, Pietro, 2014. "How laws affect behavior: Obligations, incentives and cooperative behavior," International Review of Law and Economics, Elsevier, vol. 38(C), pages 48-57.
  2. Bénabou, Roland & Tirole, Jean, 2011. "Laws and Norms," CEPR Discussion Papers 8663, C.E.P.R. Discussion Papers.
  3. Danilov, Anastasia & Sliwka, Dirk, 2013. "Can Contracts Signal Social Norms? Experimental Evidence," IZA Discussion Papers 7477, Institute for the Study of Labor (IZA).

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