Justification and Legitimate Punishment

23 Pages Posted: 18 Feb 2014

See all articles by Erte Xiao

Erte Xiao

Monash University

Fangfang Tan

Max Planck Institute for Tax Law and Public Finance

Date Written: February 17, 2014


Punishment can lose its legitimacy if the enforcer can profit from delivering punishment. We examine how justification can promote the legitimacy of punishment in a one-shot sender-receiver game where an independent third party can punish the sender upon seeing whether the sender lied. Most third parties who can profit from punishment punish the senders regardless of how the senders behave. However, when they have to provide explanations for their punishment decisions, significantly more third parties punish senders if and only if senders lie, and senders are also more likely to perceive punishment as legitimate and behave honestly.

JEL Classification: C72, C92, D63, D83

Suggested Citation

Xiao, Erte and Tan, Fangfang, Justification and Legitimate Punishment (February 17, 2014). Working Paper of the Max Planck Institute for Tax Law and Public Finance No. 2014-02, Available at SSRN: https://ssrn.com/abstract=2397150 or http://dx.doi.org/10.2139/ssrn.2397150

Erte Xiao

Monash University ( email )

23 Innovation Walk
Wellington Road
Clayton, Victoria 3800

Fangfang Tan (Contact Author)

Max Planck Institute for Tax Law and Public Finance ( email )

Marstallplatz 1
Munich, 80539

HOME PAGE: http://www.tax.mpg.de/en/pub/public_economics/public_economics_people/fangfang_tan.cfm

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