Why Punish? Social reciprocity and the enforcement of prosocial norms

DOI: 10.1007/s00191-004-0212-1J Evol Econ (2004) 14: 407429Jeffrey P. Carpenter1, Peter Hans Matthews1, and Okomboli Ongonga21 Department of Economics, Middlebury College, Middlebury, VT 05753, USA(e-mail: {jpc,pmatthew}@middlebury.edu)2 Gradute School of Business, Stanford University, Stanford, CA 94305, USA(e-mail: [email protected])Abstract. Recently economists have become interested in why people who face

social dilemmas in the experimental lab use the seemingly incredible threat of

punishment to deter free riding. Three theories with evolutionary microfoundations have been developed to explain punishment. We survey these theories and

use behavioral data from surveys and experiments to show that the theory called

social reciprocity in which people punish norm violators indiscriminately explains

punishment best.Keywords: Social dilemma Punishment Norm Evolutionary game theory

ExperimentJEL Classication: C91, C92, D64, H411 IntroductionEconomists have become interested in analyzing, in the experimental lab, something known to eld researchers for quite a while, that people who face social

dilemmas (i.e. situations in which group and individual incentives are at odds)

sometimes control free riding locally by the use of social, economic, and/or physical sanctions.1 The existence of schemes by which people monitor each other and We thank Carolyn Craven, Corinna Noelke and two referees for comments, and Middlebury College for nancial assistance. In addition, Carpenter acknowledges the support of the National Science

Foundation (SES-CAREER 0092953).Correspondence to: J.P. Carpenter1 Economic punishment experiments include Fehr and Gaechter (2000), Bochet et al. (2003), Bowles

et al. (2001), Carpenter (2002b), Carpenter and Matthews (2002), Masclet et al. (2003), and Sefton et

al. (2000). Relevant eld research is summarized in Ostrom (1990) and Ostrom et al. (1994). A specic

example of eld research is Acheson (1988).c

Springer-Verlag 2004Why Punish? Social reciprocity

and the enforcement of prosocial norms[star]408 J.P. Carpenter et al.punish those who free ride is problematic for standard economic theory. Why?

First, in non-repeated interactions, any theory assuming that agents simply want to

maximize their material gain can not reconcile the cooperative behavior needed to

obtain socially efcient outcomes because free riders always do better. Free riding

when others contribute avoids the costs associated with contributing yet returns the

benets of cooperation and free riding when others free ride prevents one from being taken advantage of. Hence, no self-interested person would ever cooperate. The

same argument can be made for not punishing free riders because punishment,...