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Formal democratic sanction mechanisms address the social dilemma in public goods games: A Chinese experimental study

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Listed:
  • Guan, Chenghua
  • Chen, Chaofan
  • Wang, Yilin
  • Pu, Gangqing

Abstract

Experimental studies have shown that punishment mechanisms effectively address the social dilemma in PGG. However, when punishment is implemented through democratic voting, it may face a democratic premium or rejection, limiting contribution increase. Drawing on insights from Putterman et al. (2011) and Andreoni and Gee (2012), we developed two formal punishment mechanisms with democratic punishment parameters. Our findings indicate that both mechanisms increase contributions while crowding out the effects of past contributions and reciprocity preferences. However, they differ in efficacy. The Lowest Punished Mechanism (LPM) resembles the anticipation effect and performs better. In LPM, both group and individual voting significantly enhance contributions.

Suggested Citation

  • Guan, Chenghua & Chen, Chaofan & Wang, Yilin & Pu, Gangqing, 2026. "Formal democratic sanction mechanisms address the social dilemma in public goods games: A Chinese experimental study," Economics Letters, Elsevier, vol. 258(C).
    • Handle: RePEc:eee:ecolet:v:258:y:2026:i:c:s0165176525005543
    DOI: 10.1016/j.econlet.2025.112717
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    References listed on IDEAS

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    JEL classification:

    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • H4 - Public Economics - - Publicly Provided Goods

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