Rich and Poor: On the Emergence of a Sanctioning Institution

Adriana Alventosa and Gonzalo Olcina

Journal of Institutional and Theoretical Economics (JITE), 2021, vol. 177, issue 1, 56-80

Abstract: This paper analyzes the implementation of centralized sanctioning on free-riding behavior in societies where wealth heterogeneity leads to different individual incentives with respect to public goods. The decision on the implementation is made by a government representing a social class. We show that if the sanctioning institution can achieve contribution by the entire population, the government representing the poor will implement it more often. This will always be efficient. However, if the sanctioning institution only achieves contribution by part of the population, the government of a free-riding rich class can implement it more often. This may be inefficient.

Keywords: public-goods game; sanctioning institutions; wealth heterogeneity; pool punishment; moral hazard (search for similar items in EconPapers)
JEL-codes: C72 D02 H41 (search for similar items in EconPapers)
Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.mohrsiebeck.com/en/article/rich-and-po ... 101628jite-2020-0050
Fulltext access is included for subscribers to the printed version.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mhr:jinste:urn:doi:10.1628/jite-2020-0050

Ordering information: This journal article can be ordered from
Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany

DOI: 10.1628/jite-2020-0050

Access Statistics for this article

Journal of Institutional and Theoretical Economics (JITE) is currently edited by Gerd Mühlheußer and Bayer, Ralph-C

More articles in Journal of Institutional and Theoretical Economics (JITE) from Mohr Siebeck, Tübingen
Bibliographic data for series maintained by Thomas Wolpert ().