Informal Sanctions

Abstract

Informal sanctions are a major determinant of a society's social capital because they are key to the enforcement of implicit agreements and social norms. Yet, little is known about the driving forces behind informal sanctions. We examine systematically the determinants of informal sanctions by a large number of experiments. Our findings show that the violation of fairness principles is the most important driving force of sanctions but, in addition, a non-negligible part of the sanctions is driven by spitefulness. We find surprisingly little evidence for strategic sanctions that are imposed to create future material benefits. Within the class of fairness-driven sanctions the motive to harm those who committed unfair actions or who revealed unfair intentions seems most important. The motive to decrease unfair payoff differences also plays some role but it cannot explain a sizeable part of the sanctions. The motive to achieve a fair relative share is largely irrelevant for sanctioning behavior.

Keywords: Informal Sanction, Social Norm, Social Capital, Strategic Sanction, Fairness, Reciprocity, Spitefulness.

JEL Classification: A13, D63, D23, C92, K42