Collective Incentives and Cooperation in Teams with Imperfect Monitoring

Friederike Mengel, Erik Mohlin () and Simon Weidenholzer

No 2018:11, Working Papers from Lund University, Department of Economics

Abstract: We experimentally explore the role of collective incentives in sustaining cooperation in finitely repeated public goods games with imperfect monitoring. In our experiment players only observe noisy signals about individual contributions, while total output is perfectly observed. We consider sanctioning mechanisms that allow agents to commit to collective punishment in case total output fall short of a target. We find that cooperation is higher in the case of collective punishment compared to both the case of no punishment and the case of standard peer-to-peer punishment which conditions on the noisy signals. Further experiments indicate that both the commitment possibility and the collective nature of punishment matter for the positive effect of collective incentives on cooperation.

Keywords: Public goods game; Team production; Punishment; Collective sanctions; Imperfect monitoring (search for similar items in EconPapers)
JEL-codes: C72 D02 D23 D90 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2018-05-19
New Economics Papers: this item is included in nep-cdm, nep-exp, nep-gth and nep-hrm
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:lunewp:2018_011

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