Endogenous choice of institutional punishment mechanisms to promote social cooperation

Anabela Botelho (), Glenn Harrison, Lígia M. Costa Pinto (), Don Ross () and Elisabet Rutstrom
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Anabela Botelho: University of Aveiro
Lígia M. Costa Pinto: University of Minho
Don Ross: University College Cork

Public Choice, 2022, vol. 191, issue 3, No 3, 309-335

Abstract: Abstract Does the desirability of social institutions for public goods provision depend on the extent to which they include mechanisms for endogenous enforcement of cooperative behavior? We consider alternative institutions that vary the use of direct punishments to promote social cooperation. In one institution, subjects participate in a public goods experiment in which an initial stage of voluntary contribution is followed by a second stage of voluntary, costly sanctioning. Another institution consists of the voluntary contribution stage only, with no subsequent opportunity to sanction. In a third stage subjects vote for which institution they prefer for future interactions: do they prefer one that does allow sanctions or one that does not allow sanctions? Our results show that even though sanctions are frequently used when available, the clear majority of individuals vote for the institution that does not allow sanctions. Thus, a distinction is required between the principles that guide the choice of institutions and the principles that apply to actions guided by institutions. Our results indicate that it is the wealth generated by the institution that determines its desirability.

Keywords: Public goods; Social institutions; Voting; Sanctions; Laboratory experiments (search for similar items in EconPapers)
JEL-codes: C92 D72 H41 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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DOI: 10.1007/s11127-020-00868-5

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