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A comparative statics analysis of punishment in public-good experiments

  • Nikos Nikiforakis

    ()

  • Hans-Theo Normann

    ()

This paper provides a comparative statics analysis of punishment in public-good experiments. We vary systematically the effectiveness of punishment, that is, the factor by which punishment reduces the punished player’s income, and we find that contributions to the public good increase monotonically in effectiveness. High effectiveness leads to near complete contribution rates and welfare improvements. Below a certain threshold, however, punishment cannot prevent the decay of cooperation found in the public-good game without punishment. In these cases, the possibility to punish may even worsen welfare. Finally, we show that punishment is a normal and inferior good.

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File URL: http://hdl.handle.net/10.1007/s10683-007-9171-3
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Article provided by Springer in its journal Experimental Economics.

Volume (Year): 11 (2008)
Issue (Month): 4 (December)
Pages: 358-369

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Handle: RePEc:kap:expeco:v:11:y:2008:i:4:p:358-369
Contact details of provider: Web page: http://www.springerlink.com/link.asp?id=102888

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  1. David Masclet & Charles Noussair & Steven Tucker & Marie-Claire Villeval, 2003. "Monetary and Nonmonetary Punishment in the Voluntary Contributions Mechanism," American Economic Review, American Economic Association, vol. 93(1), pages 366-380, March.
  2. Anderson, Christopher M. & Putterman, Louis, 2006. "Do non-strategic sanctions obey the law of demand? The demand for punishment in the voluntary contribution mechanism," Games and Economic Behavior, Elsevier, vol. 54(1), pages 1-24, January.
  3. Martin Sefton & Robert Shupp & James M. Walker, 2007. "The Effect Of Rewards And Sanctions In Provision Of Public Goods," Economic Inquiry, Western Economic Association International, vol. 45(4), pages 671-690, October.
  4. Nikos Nikiforakis & Hans-Theo Normann & Brian Wallace, 2009. "Asymmetric Enforcement of Cooperation in a Social Dilemma," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2009_20, Max Planck Institute for Research on Collective Goods.
  5. Marco Casari, 2005. "On the Design of Peer Punishment Experiments," Experimental Economics, Springer, vol. 8(2), pages 107-115, June.
  6. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
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