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The logic of costly punishment reversed: Expropriation of free-riders and outsiders

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  • Hugh-Jones, David
  • Perroni, Carlo

Abstract

Current literature views the punishment of free-riders as an under-supplied public good, carried out by individuals at a cost to themselves. It need not be so: often, free-riders’ property can be forcibly appropriated by a coordinated group. This power makes punishment profitable, but it can also be abused. It is easier to contain abuses, and focus group punishment on free-riders, in societies where coordinated expropriation is harder. Our theory explains why public goods are undersupplied in heterogenous communities: because groups target minorities instead of free-riders. In our laboratory experiment, outcomes were more efficient when coordination was more difficult, while outgroup members were targeted more than ingroup members, and reacted differently to punishment.

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  • Hugh-Jones, David & Perroni, Carlo, 2017. "The logic of costly punishment reversed: Expropriation of free-riders and outsiders," Journal of Economic Behavior & Organization, Elsevier, vol. 135(C), pages 112-130.
    • Handle: RePEc:eee:jeborg:v:135:y:2017:i:c:p:112-130
    DOI: 10.1016/j.jebo.2017.01.006
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    More about this item

    Keywords

    Cooperation; Costly punishment; Group coercion; Heterogeneity;
    All these keywords.

    JEL classification:

    • H1 - Public Economics - - Structure and Scope of Government
    • H4 - Public Economics - - Publicly Provided Goods
    • N4 - Economic History - - Government, War, Law, International Relations, and Regulation
    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact

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