Inherited Institutions: Cooperation in the Light of Democratic Legitimacy

MPI Collective Goods Preprint, No. 2017/1

The Journal of Law, Economics, and Organization, ewz004, DOI: 0.1093/jleo/ewz004

37 Pages Posted: 24 Jan 2017 Last revised: 19 Jun 2019

See all articles by Pascal Langenbach

Pascal Langenbach

Max Planck Institute for Research on Collective Goods

Franziska Tausch

Max Planck Institute for Research on Collective Goods

Date Written: January 1, 2017

Abstract

We experimentally investigate whether the procedural history of a sanctioning institution affects cooperation in a social dilemma. Subjects inherit the institutional setting from a previous generation of subjects who either decided on the implementation of the institution democratically by majority vote or were exogenously assigned a setting. In order to isolate the impact of the voting procedure, no information about the cooperation history is provided. In line with existing empirical evidence, we observe that in the starting generation cooperation is higher (lower) with a democratically chosen (rejected) institution, as compared to the corresponding, randomly imposed setting. In the second generation, the procedural history only partly affects cooperation. While there is no positive democracy effect when the institution is implemented, the vote-based rejection of the institution negatively affects cooperation in the second generation. The effect size is similar to that in the first generation.

Keywords: Endogeneity, Voting, Institutions, Social dilemma, Public good, Inherited rules

JEL Classification: C92, D02, D71, D72, H41

Suggested Citation

Langenbach, Pascal and Tausch, Franziska, Inherited Institutions: Cooperation in the Light of Democratic Legitimacy (January 1, 2017). MPI Collective Goods Preprint, No. 2017/1, The Journal of Law, Economics, and Organization, ewz004, DOI: 0.1093/jleo/ewz004, Available at SSRN: https://ssrn.com/abstract=2903950 or http://dx.doi.org/10.2139/ssrn.2903950

Pascal Langenbach (Contact Author)

Max Planck Institute for Research on Collective Goods ( email )

Kurt-Schumacher-Str. 10
D-53113 Bonn, 53113
Germany

Franziska Tausch

Max Planck Institute for Research on Collective Goods ( email )

Kurt-Schumacher-Str. 10
D-53113 Bonn, 53113
Germany

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