Normative Perception of Power Abuse

Abstract

We study how the powerful perceive power abuse, and how negative experience related to it influences the appropriateness judgments of the powerless. We create an environment conducive to unfair exploitation in a repeated Public Goods game where one player (punisher) is given a further ability to costlessly subtract money from others (victims). Punishers who abuse their power rationalize their behavior by believing that free-riding, while forcing others to contribute, is not inappropriate. More importantly, victims of such abuse also start to believe that punishers’ free-riding and punishment are justifiable. Our findings demonstrate the capacity of humans to exculpate abusive behavior.

Keywords: power abuse, norms, public goods, punishment

JEL Classification: C91, C92, K42, H41, D73