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Broken Punishment Networks in Public Goods Games: Experimental Evidence

  • Andrweas Leibbrandt

    ()

    (Department of Economics, Monash University, Australia)

  • Abhijit Ramalingam

    (School of Economics and Centre for Behavioural and Experimental Social Science, and University of East Anglia, Norwich, United Kingdom)

  • Lauri Sääksvuori

    (Strategic Interaction Group, Max Planck Institute of Economics, Jena, Germany)

  • James M. Walker

    (Department of Economics and Workshop in Political Theory and Policy Analysis, Indiana University, United States)

Abundant evidence suggests that high levels of contributions to public goods can be sustained through self-governed monitoring and sanctions. This experimental study investigates the effectiveness of decentralized sanctioning institutions where punishment opportunities are restricted to agents who are linked through alternative punishment networks. We find that the structure of the punishment network significantly impacts contributions to the public good, but not overall efficiencies. Contributions collapse over decision rounds in groups with limited punishment opportunities, even if the absolute punishment capacity corresponds to the complete punishment network where all agents are allowed to punish each other. However, after allowing for the costs of sanctions, efficiencies are similar across the different networks that allow for punishment and the no-punishment network.

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File URL: http://pubdb.wiwi.uni-jena.de/pdf/wp_2012_004.pdf
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Paper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2012-004.

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Date of creation: 02 Feb 2012
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Handle: RePEc:jrp:jrpwrp:2012-004
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  1. Ernst Fehr & Simon Gaechter, 1999. "Cooperation and Punishment in Public Goods Experiments," CESifo Working Paper Series 183, CESifo Group Munich.
  2. Jeffrey Carpenter & Shachar Kariv & Andrew Schotter, 2012. "Network architecture, cooperation and punishment in public good experiments," Review of Economic Design, Springer, vol. 16(2), pages 93-118, September.
  3. Olivier Bochet & Talbot Page & Louis Putterman, 2005. "Communication and Punishment in Voluntary Contribution Experiments," Working Papers 2005-09, Brown University, Department of Economics.
  4. James M. Walker & Matthew A. Halloran, 2004. "Rewards and Sanctions and the Provision of Public Goods in One-Shot Settings," Experimental Economics, Springer, vol. 7(3), pages 235-247, October.
  5. repec:ner:tilbur:urn:nbn:nl:ui:12-377951 is not listed on IDEAS
  6. Enrique Fatas & Miguel Meléndez-Jiménez & Hector Solaz, 2010. "An experimental analysis of team production in networks," Experimental Economics, Springer, vol. 13(4), pages 399-411, December.
  7. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  8. Carpenter, Jeffrey P., 2007. "Punishing free-riders: How group size affects mutual monitoring and the provision of public goods," Games and Economic Behavior, Elsevier, vol. 60(1), pages 31-51, July.
  9. 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.
  10. Carpenter, Jeffrey P., 2007. "The demand for punishment," Journal of Economic Behavior & Organization, Elsevier, vol. 62(4), pages 522-542, April.
  11. Hoffman, Elizabeth & McCabe, Kevin A & Smith, Vernon L, 1998. "Behavioral Foundations of Reciprocity: Experimental Economics and Evolutionary Psychology," Economic Inquiry, Western Economic Association International, vol. 36(3), pages 335-52, July.
  12. Nikos Nikiforakis, 2010. "Experimental Economics," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 43(3), pages 337-345.
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