Punishment Mechanisms and their Effect on Cooperation - A Simulation Study

M. D. Farjam, Marco Faillo (), W.F.G. Haselager and I.G. Sprinkhuizen-Kuyper

No 1302, CEEL Working Papers from Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia

Abstract: In social dilemmas punishment costs resources, not just from the one who is punished but often also from the punisher and society. Reciprocity on the other side is known to lead to cooperation without the costs of punishment. The question at hand is whether punishment besides its costs brings advantages and how its negative side-effects can be reduced to a minimum in an environment populated by reciprocal agents. Various punishment mechanisms have been studied in the economic literature such as unrestricted punishment, legitimate punishment, cooperative punishment, and the hired gun mechanism. All these mechanisms are implemented in a simulation where agents can share resources and may decide to punish other agents when they do not share. Through evolutionary learning agents adapt their sharing/punishing policy. Despite the costs of punishment, legitimate punishment compared to no-punishment increased performance when the availability of resources was low. When the availability was high, performance was better in no-punishment conditions with indirect reciprocity. Furthermore the hired gun mechanism worked only as good as other punishment mechanisms when the availability of resources was high. Legitimate punishment leads to a higher performance than unrestricted punishment. Summarized, this paper shows that a well-chosen punishment mechanism can play a facilitating role for cooperation even if the cooperating system already adopted reciprocity.

Keywords: Public Goods Games; Punishment; Cooperation; Reciprocity; Evolution of Cooperation (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-exp, nep-gth and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Punishment Mechanisms and Their Effect on Cooperation: A Simulation Study (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:trn:utwpce:1302

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