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Social norms, sanctions, and conditional entry in markets with externalities: Evidence from an artefactual field experiment

Author

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  • Riehm, Tobias
  • Fugger, Nicolas
  • Gillen, Philippe
  • Gretschko, Vitali
  • Werner, Peter

Abstract

In an artefactual field experiment with a large and heterogeneous population sample, we test the implications of social norms for market interactions associated with negative real-world externalities. We run large stylized markets in which sellers and buyers decide whether to enter the market and how much to bid for experimental coupons. Trading leads to profits for sellers and buyers but at the same time destroys donations for a good cause.

Suggested Citation

  • Riehm, Tobias & Fugger, Nicolas & Gillen, Philippe & Gretschko, Vitali & Werner, Peter, 2022. "Social norms, sanctions, and conditional entry in markets with externalities: Evidence from an artefactual field experiment," Journal of Public Economics, Elsevier, vol. 212(C).
    • Handle: RePEc:eee:pubeco:v:212:y:2022:i:c:s0047272722001037
    DOI: 10.1016/j.jpubeco.2022.104701
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    More about this item

    Keywords

    Markets; Moral behavior; Negative externalities; Social norms; Punishment; Large population sample; Experiment;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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