The Interaction of Legal and Social Norm Enforcement

32 Pages Posted: 20 Jun 2010

See all articles by Sebastian Kube

Sebastian Kube

University of Bonn; Max Planck Institute for Research on Collective Goods

Christian Traxler

Hertie School; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: June 17, 2010

Abstract

Although legal sanctions are often non-deterrent, we frequently observe compliance with ‘mild laws’. A possible explanation is that the incentives to comply are shaped not only by legal, but also by social sanctions. This paper employs a novel experimental approach to study the link between legal and social norm enforcement. We analyze whether the two institutions are complements or substitutes. Our results show that legal sanctions partially crowd out social norm enforcement. The welfare effect from mild laws is positive, however, as a higher level of compliance is achieved at lower enforcement costs.

Keywords: social sanctions, legal sanctions, norm enforcement, mild laws, laboratory experiment, VCM, public goods

JEL Classification: K42, C90

Suggested Citation

Kube, Sebastian and Kube, Sebastian and Traxler, Christian, The Interaction of Legal and Social Norm Enforcement (June 17, 2010). CESifo Working Paper Series No. 3091, Available at SSRN: https://ssrn.com/abstract=1626131 or http://dx.doi.org/10.2139/ssrn.1626131

Sebastian Kube

University of Bonn

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Hertie School ( email )

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