A comparative statics analysis of punishment in public-good experiments

Nikos Nikiforakis; Hans Theo Normann

doi:10.1007/s10683-007-9171-3

A comparative statics analysis of punishment in public-good experiments

Nikos Nikiforakis, Hans Theo Normann

Economics

Research output: Contribution to journal › Article › peer-review

Abstract

This paper provides a comparative-statics analysis of punishment in public-good experiments. We vary the effectiveness of punishment, that is, the factor by which punishment reduces the punished player's income. The data show that contributions increase monotonically in punishment effectiveness. High effectiveness leads to near complete cooperation and welfare improvements. Below a certain threshold, however, punishment cannot prevent the decay of cooperation. In these cases, punishment opportunities reduce welfare. The results suggest that the experimenter's choice of the punishment effectiveness is of great importance for the experimental outcome.

Original language	English (US)
Pages (from-to)	358-369
Number of pages	12
Journal	Experimental Economics
Volume	11
Issue number	4
DOIs	https://doi.org/10.1007/s10683-007-9171-3
State	Published - Dec 2008

Keywords

Decentralized punishment
Public good
Punishment effectiveness
Welfare

ASJC Scopus subject areas

Economics, Econometrics and Finance (miscellaneous)

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10.1007/s10683-007-9171-3

Cite this

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title = "A comparative statics analysis of punishment in public-good experiments",

abstract = "This paper provides a comparative-statics analysis of punishment in public-good experiments. We vary the effectiveness of punishment, that is, the factor by which punishment reduces the punished player's income. The data show that contributions increase monotonically in punishment effectiveness. High effectiveness leads to near complete cooperation and welfare improvements. Below a certain threshold, however, punishment cannot prevent the decay of cooperation. In these cases, punishment opportunities reduce welfare. The results suggest that the experimenter's choice of the punishment effectiveness is of great importance for the experimental outcome.",

keywords = "Decentralized punishment, Public good, Punishment effectiveness, Welfare",

author = "Nikos Nikiforakis and Normann, {Hans Theo}",

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N2 - This paper provides a comparative-statics analysis of punishment in public-good experiments. We vary the effectiveness of punishment, that is, the factor by which punishment reduces the punished player's income. The data show that contributions increase monotonically in punishment effectiveness. High effectiveness leads to near complete cooperation and welfare improvements. Below a certain threshold, however, punishment cannot prevent the decay of cooperation. In these cases, punishment opportunities reduce welfare. The results suggest that the experimenter's choice of the punishment effectiveness is of great importance for the experimental outcome.

AB - This paper provides a comparative-statics analysis of punishment in public-good experiments. We vary the effectiveness of punishment, that is, the factor by which punishment reduces the punished player's income. The data show that contributions increase monotonically in punishment effectiveness. High effectiveness leads to near complete cooperation and welfare improvements. Below a certain threshold, however, punishment cannot prevent the decay of cooperation. In these cases, punishment opportunities reduce welfare. The results suggest that the experimenter's choice of the punishment effectiveness is of great importance for the experimental outcome.

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A comparative statics analysis of punishment in public-good experiments

Abstract

Keywords

ASJC Scopus subject areas

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