Date of Original Version

12-2006

Type

Working Paper

Abstract or Table of Contents

Convergent evidence for detrimental effects of punishment on cooperation has been obtained in a wide variety of environments, ranging from American students facing punishment in laboratory experiments, to Israeli parents facing fines for arriving late to their child’s day care. We show here that enhancing the norm salience role of punishment can eliminate its detrimental effects. In a public goods game, privately implemented punishment reduces cooperation in relation to a baseline treatment without punishment. However, when that same incentive is implemented publicly, but anonymously to avoid shame, cooperation is sustained at significantly higher rates than in both baseline and private punishment treatments. Our data provide evidence that publicly implemented punishment enhances the salience of the violated social norm to both the punished and those who observe punishment, and that this increased norm salience promotes group members’ norm obedience. Our findings have important efficiency implications for the design of mechanisms intended to deter misconduct.

Comments

IZA Discussion Paper No. 1977

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