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Unobserved punishment supports cooperation

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  • Fudenberg, Drew
  • Pathak, Parag A.

Abstract

Costly punishment can facilitate cooperation in public-goods games, as human subjects will incur costs to punish non-cooperators even in settings where it is unlikely that they will face the same opponents again. Understanding when and why it occurs is important both for the design of economic institutions and for modeling the evolution of cooperation. Our experiment shows that subjects will engage in costly punishment even when it will not be observed until the end of the session, which supports the view that agents enjoy punishment. Moreover, players continue to cooperate when punishment is unobserved, perhaps because they (correctly) anticipate that shirkers will be punished: Fear of punishment can be as effective at promoting contributions as punishment itself.

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  • Fudenberg, Drew & Pathak, Parag A., 2010. "Unobserved punishment supports cooperation," Journal of Public Economics, Elsevier, vol. 94(1-2), pages 78-86, February.
  • Handle: RePEc:eee:pubeco:v:94:y:2010:i:1-2:p:78-86
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    5. Vyrastekova, Jana & Funaki, Yukihiko & Takeuchi, Ai, 2011. "Sanctioning as a social norm: Expectations of non-strategic sanctioning in a public goods game experiment," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(6), pages 919-928.
    6. Both, F. & Adam, M.T.P. & Hariharan, A. & Dorner, V. & Lux, E. & Weinhardt, C., 2016. "A randomized tabu search-based approach for perfect stranger matching in economic experiments," Economics Letters, Elsevier, vol. 145(C), pages 235-238.
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