TY - JOUR
T1 - In the long-run we are all dead
T2 - on the benefits of peer punishment in rich environments
AU - Engelmann, Dirk
AU - Nikiforakis, Nikos
N1 - Funding Information:
Financial support from the Faculty of Business and Economics at the University of Melbourne is gratefully acknowledged. We would like to thank Jun Wey Lee for research assistance and two anonymous referees, as well as participants at the Workshop “Experiments on Conflicts, Inequality and Incentives” at Université de Rennes 1, at the Econometric Society European Meeting in Göteborg and the annual meeting of the Verein für Socialpolitik in Düsseldorf for helpful comments. Dirk Engelmann is a Research Associate at CERGE-EI, Prague, the Czech Republic.
Publisher Copyright:
© 2015, Springer-Verlag Berlin Heidelberg.
PY - 2015/10/1
Y1 - 2015/10/1
N2 - We investigate whether peer punishment is an efficient mechanism for enforcing cooperation in an experiment with a long time horizon. Previous evidence suggests that the costs of peer punishment can be outweighed by the benefits of higher cooperation if (i) there is a sufficiently long time horizon and (ii) punishment cannot be avenged. However, in most instances in daily life, when individuals interact for an extended period of time, punishment can be retaliated. We use a design that imposes minimal restrictions on who can punish whom or when, and allows participants to employ a wide range of punishment strategies including retaliation of punishment. Similar to previous research, we find that, when punishment cannot be avenged, peer punishment leads to higher earnings relative to a baseline treatment without any punishment opportunities. However, in the more general setting, we find no evidence of group earnings increasing systematically or significantly over time relative to the baseline treatment. Our results raise questions under what conditions peer punishment can be an efficient mechanism for enforcing cooperation.
AB - We investigate whether peer punishment is an efficient mechanism for enforcing cooperation in an experiment with a long time horizon. Previous evidence suggests that the costs of peer punishment can be outweighed by the benefits of higher cooperation if (i) there is a sufficiently long time horizon and (ii) punishment cannot be avenged. However, in most instances in daily life, when individuals interact for an extended period of time, punishment can be retaliated. We use a design that imposes minimal restrictions on who can punish whom or when, and allows participants to employ a wide range of punishment strategies including retaliation of punishment. Similar to previous research, we find that, when punishment cannot be avenged, peer punishment leads to higher earnings relative to a baseline treatment without any punishment opportunities. However, in the more general setting, we find no evidence of group earnings increasing systematically or significantly over time relative to the baseline treatment. Our results raise questions under what conditions peer punishment can be an efficient mechanism for enforcing cooperation.
KW - C92
KW - D70
KW - H41
UR - http://www.scopus.com/inward/record.url?scp=84944147561&partnerID=8YFLogxK
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U2 - 10.1007/s00355-015-0884-5
DO - 10.1007/s00355-015-0884-5
M3 - Article
AN - SCOPUS:84944147561
SN - 0176-1714
VL - 45
SP - 561
EP - 577
JO - Social Choice and Welfare
JF - Social Choice and Welfare
IS - 3
ER -