Driving Forces Behind Informal Sanctions

Armin Falk, Ernst Fehr and Urs Fischbacher

No 1635, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper investigates the driving forces behind informal sanctions in cooperation games and the extent to which theories of fairness and reciprocity capture these forces. We find that cooperators' punishment is almost exclusively targeted towards the defectors but the latter also impose a considerable amount of spiteful punishment on the cooperators. However, spiteful punishment vanishes if the punishers can no longer affect the payoff differences between themselves and the punished individual, whereas the cooperators even increase the resources devoted to punishment in this case. Our data also discriminate between different fairness principles. Fairness theories that are based on the assumption that players compare their own payoff to the group's average or the group's total payoff cannot explain the fact that cooperators target their punishment at the defectors. Fairness theories assuming that players aim to minimize payoff inequalities cannot explain the fact that cooperators punish defectors even if payoff inequalities cannot be reduced. Therefore, retaliation, i.e., the desire to harm those who committed unfair acts, seems to be the most important motive behind fairness-driven informal sanctions.

Keywords: fairness; reciprocity; social norm; cooperation; sanctioning; spitefulness (search for similar items in EconPapers)
JEL-codes: A13 C92 D23 D63 K42 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2005-06
New Economics Papers: this item is included in nep-cbe, nep-law, nep-ltv and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (208)

Published - published in: Econometrica, 2005, 7 (6), 2017-2030

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