3 Pages Posted: 17 Oct 2011 Last revised: 5 Sep 2013
Date Written: October 1, 2011
This paper investigates how punishment promotes cooperation when the punishment enforcer is independent of its proposer. In a prisoner’s dilemma experiment, compared with the case when the implicated parties are allowed to punish each other, cooperation is lower when the enforcement of punishment requires approval from an independent third party. Our data show that the independent third party mitigates the severity of punishment and consequently diminishes the effectiveness of punishment on promoting cooperation when antisocial punishment proposals are rare.
Keywords: Social dilemmas, third party, punishment, cooperation, experiment
JEL Classification: C72, C92, D63
Suggested Citation: Suggested Citation
Tan, Fangfang and Xiao, Erte, Peer Punishment with Third-Party Approval in a Social Dilemma Game (October 1, 2011). Economics Letters, Vol. 117, 2012; Working Paper of the Max Planck Institute for Tax Law and Public Finance No. 2011-16. Available at SSRN: https://ssrn.com/abstract=1945211 or http://dx.doi.org/10.2139/ssrn.1945211