Exclude the Bad Actors or Learn About The Group

David Hugh-Jones and David Reinstein ()

Economics Discussion Papers from University of Essex, Department of Economics

Abstract: In public goods environments, the threat to punish non-contributors may increase contributions. However, this threat may make players' contributions less informative about their true social preferences. This lack of information may lead to lower contributions after the threat disappears, as we show in a two stage model with selfish and conditionally cooperatives types. Under specified conditions welfare may be improved by committing not to punish or exclude. Our laboratory evidence supports this. Contributions under the threat of targeted punishment were less informative of subjects' later choices than contributions made anonymously. Subjects also realised that these were less informative, and their incentivized predictions reflected this understanding. We find evidence of conditional cooperation driven by beliefs over other's contributions. Overall, our anonymous treatment led to lower first-stage contributions but significantly higher second-stage contributions than our revealed treatment. Our model and evidence may help explain why anonymous contributions are often encouraged in the real world.

Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://repository.essex.ac.uk/10010/ original version (application/pdf)

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:esx:essedp:10010

Ordering information: This working paper can be ordered from
Discussion Papers Administrator, Department of Economics, University of Essex, Wivenhoe Park, Colchester CO4 3SQ, U.K.

Access Statistics for this paper

More papers in Economics Discussion Papers from University of Essex, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Essex Economics Web Manager ().