Cooperation and Public Goods
Provision
•
•
•
•
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A basic design
Determinants of voluntary cooperation
¾ Marginal private benefits
¾ Group size
¾ Communication
Why do people cooperate?
¾ Strategic cooperation
¾ Cooperation as a mistake
¾ Conditional Cooperation
Testing an incentive compatible mechanism for the private provision
of public goods
Cooperation and private punishment
Ernst Fehr – Experimental & Behavioral Economics
1
Cooperation problems
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Cooperative hunting and warfare (important during human evolution)
Exploitation of common pool resources
Clean environment
Teamwork in organizations
Collective action (demonstrations, fighting a dictatorship)
Voting
Basic economic problem
Cooperative behavior has a positive externality.
Hence, private marginal benefit is smaller than social marginal
benefit → underprovision relative to the efficient level.
Ernst Fehr – Experimental & Behavioral Economics
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A Basic Design
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•
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Group with n subjects.
yi is endowment of player i.
2 investment possibilities
ƒ Private account
ƒ Public good (called “project”, “alternative B”)
ci = contribution to the public good.
Simultaneous contribution decision.
One-shot game or finitely repeated game.
Average contribution in the group or contribution vector as feedback.
n
Income per period:
π i = ( y i − ci ) + α ∑ c j
j =1
Ernst Fehr – Experimental & Behavioral Economics
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Prediction
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If α < 1: ci = 0 is a dominant strategy
If nα > 1 surplus maximization requires ci = yi
Typical example
ƒ n=4
ƒ yi = 20
ƒ α = 0.4
ƒ Groups randomly rematched for 10 periods (stranger design)
ƒ or stable group composition for 10 periods (partner design)
Ernst Fehr – Experimental & Behavioral Economics
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Determinants of Voluntary Cooperation
Isaac, Walker, Thomas (1984)
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Aim: Isolate effects of group size and the MPCR α.
πi=y-ci+αΣci
α measures the private marginal benefit, nα the social marginal
benefit.
Income from private account y-ci was private information; income
from group account (αΣci) was public information.
10 periods, public information
Information feedback at the end of each period: sum of contributions
and private income.
A: n=4, MPCR=.3, nα=1.2
C: n=4, MPCR=.75, nα =3
B: n=10, MPCR=.3, nα =3
D: n=10, MPCR=.75, nα =7.5
•A-C, B-D: MPCR-effect
•A-B, C-D: Group size effect with constant MPCR
•B-C: Group size effect with constant group benefit nα
Ernst Fehr – Experimental & Behavioral Economics
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Ernst Fehr – Experimental & Behavioral Economics
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Results
MPCR=.3
MPCR=.75
n=4
A: 19
C: 57
n=10
B: 33
D: 59
•
•
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Table shows average contributions in percent
Cooperation increases with MPCR for both n.
Cooperation increases with n if MPCR is low (not when it is high).
Cooperation decreases with n if group benefit nα constant.
•
Cooperation decreases over time, in particular in treatments with low
MPCR.
MPCR-effect is present in all periods.
Group size effect at low MPCR vanishes over time.
•
•
Ernst Fehr – Experimental & Behavioral Economics
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Further Results
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Experienced subjects cooperate significantly less.
Experiments with larger groups (40 and 100)
ƒ Cooperation does not decline over time if MPCR = .3 and n =
40.
ƒ If MPCR = .03 and n = 40 cooperation rapidly declines.
ƒ Conjecture: If n increases at a constant MPCR the probability
of “beneficial” coalitions rises.
ƒ Assumes that subjects’ earnings at zero cooperation are a
reference point. If sufficiently many cooperate they earn more
although they also cooperate.
Ernst Fehr – Experimental & Behavioral Economics
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From Davis & Holt 1993
Ernst Fehr – Experimental & Behavioral Economics
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Communication & Voluntary Cooperation
(Isaac & Walker 1988)
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n = 4, α = .3, two sequences with 10 periods each, partner design.
Communication opportunities (C): Players can discuss what they want
to do in the experiment. Yet, no revelation of endowments, no threat
and no side payments allowed.
•
Treatments
1. C – NC, players have the same endowment.
2. NC – C, players have the same endowment
3. C – NC, asymmetric endowments.
Ernst Fehr – Experimental & Behavioral Economics
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Ernst Fehr – Experimental & Behavioral Economics
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Results
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Start with C: High cooperation rates; also in the second NC-phase.
Start with NC: Unraveling of cooperation in NC but after C rapid
increase in cooperation.
Asymmetric endowments partly undermine positive communication
effects.
Interpretation
• If selfishness and rationality is common knowledge
communication should play no role.
• Suggests that subjects have motives beyond self-interest
• Keeping promises, sympathy, social approval
• Conditional cooperation
Ernst Fehr – Experimental & Behavioral Economics
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Why do people cooperate?
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Mistakes, initially they don’t understand that zero cooperation is a
dominant strategy.
Strategic cooperation (Kreps et al., JET 1982)
ƒ There are strategic (rational) and tit-for-tat players.
ƒ Strategic players cooperate (except in the final period) if they
believe they are matched with tit-for-tat players.
ƒ Strategic players mimic tit-for-tat players (i.e. they cooperate)
to induce other strategic players to cooperate.
ƒ Holds for certain parameter values
Social preferences
ƒ Altruism, “warm glow”, “efficieny”-seeking motives
ƒ Conditional cooperation, Reciprocity
Ernst Fehr – Experimental & Behavioral Economics
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Why does cooperation decline over time?
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Mistakes
ƒ It takes time to learn to play the dominant strategy.
Strategic cooperation if group composition is constant.
Social preferences
ƒ Subjects are conditionally cooperative and learn that there are
free-riders in the group.
ƒ As a response they punish other group members by choosing
lower cooperation levels.
Ernst Fehr – Experimental & Behavioral Economics
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Discriminating between competing
explanations
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One-shot-game rules out strategic cooperation but it also rules out
learning to play the dominant strategy.
Partner-Stranger-Comparison (Andreoni 1988)
¾ Partner: same group composition in all periods.
¾ Stranger: random recomposition of groups in every period.
ƒ If partners cooperate more: support for strategic cooperation
hypothesis
ƒ However: It is also consistent with a miscoordination
hypothesis. Conditional cooperators can better avoid
miscoordination in a partner design.
Surprise restart: if subjects cooperate again after a surprise restart the
decline in cooperation cannot be explained with “learning to play the
dominant strategy”.
Ernst Fehr – Experimental & Behavioral Economics
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Contributions to
Group Exchange
(% of efficient level)
25
20
100%
Tokens
Strangers
80%
60%
15
10
40%
20%
5
Partners
0%
0
1
2
3
4
5
6
7
8
9
10
Period
1
2
3
4
5
6
7
8
9 10 1
an independent observation.
3
4
5
6
7
8
9 10
Period Number
Partners
Andreoni JPubE 1988
Claims that strangers cooperate
more than partners. However,
significance is only achieved by
treating each individual decision as
2
Strangers
Croson 1996
Partners contribute more than
strangers
Note the increase after the restart
in period 11.
Andreoni 1988 also observed a
restart effect.
Ernst Fehr – Experimental & Behavioral Economics
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Partners versus Strangers
C o o p eratio n o f P artn ers an d S tran g ers (S o u rce:
F eh r an d G äch ter A E R 2000)
20
18
P artn er
16
S tran g er
Cooperation
14
12
10
8
6
4
2
0
1
2
3
6 partner groups
2 stranger sessions with 6 groups each
4
5
6
7
8
9
10
P erio d
Ernst Fehr – Experimental & Behavioral Economics
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Is voluntary cooperation a mistake?
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In previous experiments: Zero cooperation is a dominant strategy for
selfish players.
Every mistake causes a contribution above the equilibrium.
Question: Do subjects play an interior dominant strategy equilibrium
or do they still overcontribute relative to the standard prediction?
Σ
πi = v(y-ci)+α ci , v is concave and v’ is linear in y- ci
FOC: v’(y-ci) = α
Generates an interior dominant strategy equilibrium (with the right
parameters)
Ernst Fehr – Experimental & Behavioral Economics
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Keser (Economic Letters 1996)
Willinger&Ziegelmayer (Exp. Econ 2001)
Overcontributions also occur if the dominant
strategy equilibrium implies very high
contributions.
Mistakes cannot explain voluntary cooperation
Ernst Fehr – Experimental & Behavioral Economics
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Direct Evidence for Conditional Cooperation
(Fischbacher, Gächter & Fehr Econ Lett 2001)
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n = 4, MPCR = .4
One-shot game
Subjects choose...
ƒ An unconditional contribution
ƒ A conditional contribution, i.e., for every given average contribution
of the other members they decide how much to contribute.
At the end one player is randomly chosen. For her the contribution schedule is
payment relevant, for the other three members the unconditional contributions
is payment relevant.
¾ A selfish player is predicted to always choose a conditional contribution
of zero.
¾ Note that a selfish player may have an incentive to choose a positive
unconditional contribution if she believes that others are conditionally
cooperative.
Ernst Fehr – Experimental & Behavioral Economics
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Decision Screen
Ernst Fehr – Experimental & Behavioral Economics
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Average own contribution level for each average contribution
level of other group members (Source: Fischbacher, Gächter &
Fehr EL 2001)
20
Own contribution
18
16
Conditional
cooperation: 48 %
14
12
10
total average
(N=44)
8
6
4
2
"hump-shaped": 14 %
Free riding: 30 %
0
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Average contribution level of other group members
Ernst Fehr – Experimental & Behavioral Economics
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subject==1
subject==2
subject==3
subject==4
subject==5
subject==6
subject==7
subject==8
subject==9
subject==10
subject==11
subject==12
subject==13
subject==14
subject==15
subject==16
subject==17
subject==18
subject==19
subject==20
subject==21
subject==22
subject==23
subject==24
subject==25
subject==26
subject==27
subject==28
subject==29
subject==30
subject==31
subject==32
subject==33
subject==34
subject==35
subject==36
subject==37
subject==38
subject==39
subject==40
subject==41
subject==42
subject==43
subject==44
20
15
10
5
0
20
15
10
5
0
20
15
10
5
0
20
15
10
5
0
20
15
10
5
0
20
15
10
5
0
0
5
10
15
20
0
5
10
15
20
0
5
10
15
20
0
5
10
15
20
0
5
10
15
20
15
10
5
0
0
5
10
15
20
0
5
10
15
20
Contribution other group members
Contribution schedules per subject
Ernst Fehr – Experimental & Behavioral Economics
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20
Results
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Unconditional cooperation is virtually absent.
Heterogeneity:
ƒ Roughly half of the subjects are conditional cooperators.
ƒ Roughly one third is selfish.
ƒ A minority has a “hump-shaped” contribution schedule
Question: Can the observed pattern of conditional cooperation explain
the unraveling of cooperation?
ƒ Assume adaptive expectations. Subjects believe that the other
group members behave in the same way as in the previous
period.
ƒ This implies that over time the conditional cooperators
contribute little although they are not selfish.
ƒ This result holds qualitatively for any kind of adaptive
expectations.
Ernst Fehr – Experimental & Behavioral Economics
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100
90
revis ed belief about others '
average c ontribution
80
initial c onditional
c ontributon bas ed
on initial belief
70
Conditional cooperation
45 0 -line
nex t period's c onditional
c ontribution bas ed on the
revis ed belief
60
50
average
c onditional
c ooperation
40
30
20
initial belief
about others '
c ontribution
10
0
0
10
20
30
40
50
60
70
80
90
100
Be lie f a b o u t w h a t o th e rs co n trib u te o n a ve ra g e
Ernst Fehr – Experimental & Behavioral Economics
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Simulated path and actual experimental path of average
7
Average contribution
6
5
actual
4
simulated
3
2
1
0
1
2
3
4
5
6
7
8
Periode
Actual path comes from a
perfect stranger treatment by
Fehr & Gächter
Ernst Fehr – Experimental & Behavioral Economics
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10
26
Conditional Cooperation in Russia (Belgorod,
Brijansk and Kinel, N=108)
Gächter & Herrmann (2002)
20
Own contribution
18
16
cond. cooperators 50%
14
12
mean (n=108)
10
8
6
4
hump-shaped 7.4%
2
0
free riders 8.3%
0 2 4 6 8 10 12 14 16 18 20
Average contribution of other group members
Ernst Fehr – Experimental & Behavioral Economics
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The relevance of conditional cooperation
•
Part of an explanation of several features of actual cooperation
behavior in experiments.
ƒ Positive contributions
ƒ Unraveling of cooperation
ƒ Restart effect
ƒ Cooperation enhancing effect of communication
•
Open question
ƒ Why are many people conditionally cooperative?
Ernst Fehr – Experimental & Behavioral Economics
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The laboratory as a wind tunnel
(Falkinger, Fehr, Gächter, Winter-Ebmer AER 2000)
•
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The Falkinger mechanism for public goods provision
ƒ For every $ above the average contribution of the others (in your
income class) you are paid $β. For every $ below you have to
pay $β.
Mechanism has nice features.
ƒ Simple
ƒ In the Nash-equilibrium the public good is provided at an
efficient level.
ƒ Low information requirements for the regulator.
ƒ The public budget is always (in and out of equilibrium) balanced.
The mechanism in a linear PG
ƒ πi = y-ci+αΣci + β(ci-C-i/(n-1))
ƒ dπi/dci=-1+α+β; positive, if β>1-α
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Does the mechanism work in practice?
•
...with boundedly rational subjects.
•
...if a percentage of the subjects exhibits social preferences.
ƒ Contributing $1 creates a net gain of α+β-1 and the other
group members gain α-β/(n-1), which is higher if β < (n-1)/n
ƒ Does envy induce people to contribute inefficiently little?
•
How does a potential interaction between bounded rationality and
social preferences play out.
Ernst Fehr – Experimental & Behavioral Economics
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Design
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•
Main experiment
ƒ n=4, α=0.4, β=0.7
ƒ 10 periods
ƒ Treatment with the mechanism and a control treatment without
the mechanism.
Checking the mechanism‘s robustness with further experiments
ƒ n=8, n=16
ƒ Interior Nash-equilibrium (concave utility of the private good).
ƒ Heterogeneity: Subjects have different returns from the private
good.
ƒ 20 periods
Ernst Fehr – Experimental & Behavioral Economics
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From Falkinger et al. AER 2000
Corner equilibria
Ernst Fehr – Experimental & Behavioral Economics
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From Falkinger et al. AER 2000
Corner equilibria
Ernst Fehr – Experimental & Behavioral Economics
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From Falkinger et al. AER 2000
Corner equilibria
Ernst Fehr – Experimental & Behavioral Economics
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Heterogeneous (Induced) Preferences
From Falkinger et al. AER 2000
Interior equilibria
Ernst Fehr – Experimental & Behavioral Economics
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Results
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Contributions in the linear control treatment converge towards 18%.
Contributions in the linear mechanism treatment are 90% from period
3 onwards.
If the mechanism treatment comes after the control treatment it takes
longer to reach high contribution levels but even then contributions
quickly converge towards 90%.
Variance of contributions in the mechanism treatment is much lower.
Actual transfer payments are relatively low.
Ernst Fehr – Experimental & Behavioral Economics
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Cooperation, Punishment & Social Norms
(Fehr & Gächter AER 2000, NATURE 2002)
•
•
•
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A social norm is
ƒ a behavioral regularity that
ƒ rests on a common belief of how one should behave and
ƒ is enforced by informal sanctions.
Remark: In the case that there is no conflict between privately optimal behavior
and the behavior prescribed by the norm there is nothing to enforce.
Coleman (Foundations of Social Theory, 1990) proposes that there is a demand
for social norms (i.e. the should component emerges naturally) in situations
where private actions create externalities.
Coleman (1990): “A norm exists only when others assume the right to affect the
direction an actor’s action will take. [...] Acceptance of the legitimacy of others’
right to partially control his action is necessary to establish the norm that gives
him a legitimate right to control others’ similar actions.”
Example: The no-smoking norm emerged after it became clear that passive
smoking is detrimental for health.
Ernst Fehr – Experimental & Behavioral Economics
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Examples of Social Norms
•
•
•
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•
Don’t lie
Keep promises.
Wear similar cloth as your peers.
Norms with regard to club membership, union membership and preferences for
political parties. (Akerlof 1980).
Norms against rate busters in piece rate systems (Whyte 1955), Roethlisberger,
Dickson 1947).
Norms against strike breaking: “To isolate those who supported the ‘scab
union’, cinemas and shops were boycotted, there were expulsions from
football teams, bands and choirs and ‘scabs’ were compelled to sing on their
own in their chapel services. ‘Scabs’ witnessed their own ‘death’ in
communities which no longer accepted them” (Francis’ 1985, p. 269, strike of
the British miners in 1984).
Norms against the overexploitation of common resources (Ostrom 1991).
Many of these examples indicate a public goods aspect of social norms.
Ernst Fehr – Experimental & Behavioral Economics
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Standard Economic Approach of Modeling
Social Norms
•
•
•
•
•
Subgame perfect equilibria in infinitely repeated games.
Approach shows nicely what is possible.
Standard approach is incomplete in important respects.
ƒ Little predictive content because of too many equilibria.
ƒ Does not deal with the normative component of a social norm,
i.e. it makes not prediction what individuals should do.
ƒ Emotions are typically left out of the picture although they are
likely to be a driving force of norm enforcement.
Idea: violations of social norms trigger negative emotions which in
turn trigger a willingness to punish the violators.
This contributes to the enforcement of the norm.
Ernst Fehr – Experimental & Behavioral Economics
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A Cooperation and Punishment Experiment
•
•
Stage 1: typical linear public goods design: n = 4, α = 0.4.
Stage 2: Punishment opportunity
ƒ Subjects are informed about each member’s contribution.
ƒ Subjects can punish other group members at a cost to
themselves.
ƒ A punished subject could not lose more than the first-stage
income.
Punishment
Costs
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
1
2
4
6
9
12
16
20
25
30
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Treatments
•
•
•
•
•
Two partner sessions: no pun – pun and pun – no pun.
Each part of the sequence lasted 10 periods.
Subjects in the first part of the sequence did not know that there is a
second part.
3 Stranger-Session: two times pun – no pun. Once no pun – pun.
In the Nature (2002) paper we had 5 perfect stranger sessions with pun
– no pun and 5 sessions with no pun – pun.
Ernst Fehr – Experimental & Behavioral Economics
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Predictions
•
•
It is common knowledge that each subject is a money maximizer and
rational:
¾ No punishment
¾ No contribution regardless of whether there is a punishment
opportunity.
If common knowledge is absent, subjects in the partner treatment are
able to build up a group reputation (“There are punishers in the group,
hence it is better to cooperate”)
¾ Partner: Cooperate and punish in early periods but stop
cooperating and punishing at least in the final period.
¾ Stranger: no punishment and no cooperation.
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Alternative Views
•
•
•
•
Part of the subjects have a preference for reciprocity. They reward nice
and punish hostile behavior.
The relevant reference point for the definition of kindness is
“conditional cooperation”. Two variants:
¾ If I cooperate the other members should cooperate as well.
¾ The other group members’ average cooperation as a reference
point.
¾ Reference point question is unsolved yet.
Conditional cooperation is perceived as nice. Free-riding relative to the
reference point is perceived as hostile and is, hence, punished.
Punishment stabilizes cooperation in the group.
Ernst Fehr – Experimental & Behavioral Economics
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Cooperation with and without Punishment
Mean Contribution
(Fehr & Gächter AER 2000)
20
18
16
14
12
10
8
6
Partners
4
2
0
1
3
5
7
9
11
13
15
17
19
Period
Ernst Fehr – Experimental & Behavioral Economics
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Average punishment points
8
7
6
5
Received punishm ent points per
deviation from average and percentage of
decisions
2
3
6
10
4
12
3
2
20
26
1
Partner
Stranger
57
17 30
6 10
[-2,2]
(2,8]
(8,14]
1
0
[-20,-14) [-14,-8)
[-8,-2)
(14,20]
Deviation from the mean contribution of the other
group members
Ernst Fehr – Experimental & Behavioral Economics
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A More Detailed Picture
Ernst Fehr – Experimental & Behavioral Economics
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Distribution of Contributions over all
periods
Ernst Fehr – Experimental & Behavioral Economics
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Received points in p & s for contributions
Ernst Fehr – Experimental & Behavioral Economics
48
Received punishment for given contribution
Reference point below which subjects are punished is lower in stranger treatment
Ernst Fehr – Experimental & Behavioral Economics
49
Punishment among Perfect Strangers
Mean expenditure by punishing group members
10
4.2
6
3.1
9
8
7
7.5
4.9
6
period 1-4
period 5-6
period 6
4.2
5
14.8 13
4
22
3
2
40.3
26.7
39.4
31.4
32.9
1
31.9
5.5
7.8 4.4
0
[-20,-14)
[-14,-8)
[-8,-2)
[-2,2]
(2,8]
(8,14]
Deviation from the average cooperation level of the other group members
Source: Fehr&Gächter
Nature 2002
Ernst Fehr – Experimental & Behavioral Economics
50
Cooperation among Perfect Strangers
a
20
without punishment
with punishment
18
Mean cooperation
16
14
12
10
8
6
4
2
0
1
2
3
4
5
6
1
2
3
4
5
6
Period
Source: Fehr&Gächter
Nature 2002
Ernst Fehr – Experimental & Behavioral Economics
51
b
without punishment
20
with punishment
18
Mean cooperation
16
14
12
10
8
6
4
2
0
1
2
3
4
5
6
1
2
3
4
5
6
Period
Source: Fehr&Gächter
Nature 2002
Ernst Fehr – Experimental & Behavioral Economics
52
Punishment Incentives to Obey the Norm
30
Mean earnings
25
20
15
10
5
0
[-2 0 ,-1 4 )
[-1 4 ,-8 )
[-8 ,-2 )
[-2 ,2 ]
(2 ,8 ]
(8 ,1 4 ]
D e v ia tio n fr o m th e a v e r a g e c o o p e r a tio n le v e l o f th e o th e r
g ro u p m e m b e rs
Based on: Fehr&Gächter
Nature 2002
Ernst Fehr – Experimental & Behavioral Economics
53
Conclusions
•
•
•
•
Punishment opportunity allows enforcement of cooperative norms.
Subjects whose contributions are below a relevant reference points are
punished.
By those who cooperate
This also enhances cooperation in a perfect stranger design.
Ernst Fehr – Experimental & Behavioral Economics
54
Results have been replicated in many other studies
•
•
•
•
•
•
•
Sefton, Shupp & Walker (2002)
Masclet, Noussair, Villeval & Tucker (AER 2003)
Page, Putterman & Unel (2002)
Carpenter & Matthews (2002)
Falk, Fehr & Fischbacher (2001)
Carpenter (2001)
Bowles, Carpenter & Gintis (2001)
Ernst Fehr – Experimental & Behavioral Economics
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Cooperation and Punishment in Russia
(Gächter Herrmann 200x)
•
Did past experience in the Soviet Union leave traces in cooperation
and punishment behavior.
•
•
Instrument: Cooperation and punishment experiment
Subjects:
• 126 Students (to provide a comparison with data from other
student samples)
• 183 non students from cities
•
90 non students from the countryside
Ernst Fehr – Experimental & Behavioral Economics
56
Kursk:
Moscow
Inhabitants:
240,000
Average Income:
92 $/month
Ernst Fehr – Experimental & Behavioral Economics
57
Professions of Non Students
Profession
Subjects living in cities
in %
Subjects living on
the countryside
in %
Employees in private sector
39.9
21.1
Managers
5.5
7.8
Workers
31.7
40.0
State employees
4.4
5.6
0
3.3
Entrepreneurs
6.0
0
House wifes
2.2
10.0
No information available
10.4
12.2
Farmers
Ernst Fehr – Experimental & Behavioral Economics
58
Design
•
•
•
n = 3, one-shot Experiment.
ci obeys 0 ≤ ci ≤ 20
Income at the first stage:
n
π = 20 − c i + 0 . 5 ∑ c j
1
i
•
j =1
Income after punishment points pji and pij have been imposed:
n
π i = π i1 − ( 3 ∑ p ji +
j =1
•
•
n
∑
j =1
p ij )
N-P Experiment (2 one-shots)
P-N Experiment (2 one-shots)
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Contributions in P-N Sequence
12
Mean contribution
10
8.92
8.79
P
8
6.38
6
5.22
N
4
2
0
students
(n=72)
urban dwellers
(n=79)
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Contributions in N-P Sequence
12
10.94
10.02
9.58
Mean contribution
10
8
6
7.37
N
7.52
5.76
P
4
2
0
students
(n=54)
urban dwellers
(n=90)
villagers
(n=88)
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Socio-Economic Determinants of Cooperation
Cooperation in N
Cooperation in P
2nd sequence
-4.47***
-2.08**
White collar
4.09**
1.96
Blue collar
2.64
-0.32
Other jobs
1.79
-0.08
Age
0.01
0.08
Female
0.37
-0.23
Religiosity
2.22**
1.67*
City size
-0.90**
-1.10***
Constant
8.31***
8.26***
n=371
*10%; ** 5%; *** 1%
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Punishment Behavior (N-P)
of students:
own punishment
10
of urban dwellers:
10
10
10
8
8
8
8
6
6
6
6
4
4
4
4
2
2
2
2
0
0
0
0
-20 -15 -10 -5
0
5
10 15 20
Deviation from punisher
-20 -15 -10 -5
0
5
10 15 20
Deviation from punisher
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Punishment Behavior (N-P)
own punishment
of students:
of villagers:
10
10 10
10
8
8
8
8
6
6
6
6
4
4
4
4
2
2
2
2
0
0
0
0
2
-20 -15 -10 -5
0
5
10 15 20
Deviation from punisher
-20 -15 -10 -5
0
5
10
15
20
Deviation from punisher
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Punishment Behavior (P-N)
own punishment
of students:
of urban dwellers:
10
10
10
10
8
8
8
8
6
6
6
6
4
4
4
4
2
2
2
2
0
0
0
0
-20 -15 -10 -5
0
5
10 15 20
Deviation from punisher
-20 -15 -10 -5
0
5
10
15
20
Deviation from punisher
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Socio-economic Determinants of Punishment Behavior
Coefficient
p-value
Negative deviation
-0.32***
0.000
Positive deviation
0.10
0.102
2nd sequence
-1.30*
0.085
White collar
-1.83*
0.057
Blue collar
0.75
0.436
Other jobs
2.09**
0.041
Age
0.08**
0.030
Female
0.37
0.608
Religiosity
1.04
0.118
City size
-0.12
0.688
Constant
-5.88***
0.000
n=371
*10%; ** 5%; *** 1%
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Conclusions
•
In western societies those who cooperate punish those who defect.
¾ Enforces higher cooperation levels.
•
In Russia there is a significant share of spiteful punishment, i.e. those
who cooperated above average are punished.
¾ Punishment opportunity does therefore not increase cooperation.
•
Note: Punishment reduces the surplus; it is the threat of punishing free
riders which, if effective, increases the surplus.
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