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Behaviour > 13 - punishment and the grimmer side > Flashcards

13 - punishment and the grimmer side Flashcards

1
Q

peoples contributions in public good games are motivated by 3 things

A

error
strategic considerations
other-regarding preferences

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2
Q

what are other regarding preferences

A

makes them want to contribute to help others
also willing to harm others

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3
Q

what is reciprocity

A

desire to reciprocate
- be kind to people that are kind
- harm people that harm

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4
Q

what is the reciprocity model preseneted by Dufwenberg and Kirchsteiger

A
  • overall utility is weighted sum of 2 components: material payoffs + reciprocation payoff
  • people make tradeoffs between these 2 payoffs

> utility depends on perceived intentions

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5
Q

what is the reciprocation payoff in

Dufwenberg

A
  • if j is kind to i - i’s payoff is higher - and she is kinder in return
  • if j is unkind - i’s payoff higher the unkinder she is

> increased payoff when you recirpocate
* willing to harm others at a cost - makes you happier

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6
Q

what is aversion to inequality

Fehr Schmidt preferences

A
  • aversion to both directions of inequality, but especially towards unfavourable inequality
  • get disutility from the inequality
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7
Q

what are Fehr Schmidt preferences

A

suggests that peoples utility from outcomes is influenced not only by material payoffs but also by fairness considerations and the distribution of payoffs amongst others

  • more money for yourself and other person is good - if you are better off than them
  • more money for them is bad if they are better off than me
  • utility function depends material payoff + whether there is inequality + who is better off than who
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8
Q

what 2 reasons explain why people might be willing to sacrifice personal gains to enforce fairness or punish

A
  1. inequality aversion
  2. reciprocity
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9
Q

when do you get disutility in Fehr Schmidt preferences

A
  • disutility if you are better off than others, and if others are better off than you
  • especially averse to being worse off than others
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10
Q

explain the indifference curves
Fehr Schmidt preferences

A

triangle
- above the equality line = upward sloping
- below the equality line = downward sloping

  • if you hurt xj enough - it will increase the utility of me
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11
Q

what do the ICs show about harm

A

I is willing to face a small cost, making both people worse off
- if j is hurt enough relative to i
* would be on a higher utility curve

  • get increased utility from seeing j get hurt if j is advantaged
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12
Q

how could you prevent free riding problem and prevent the decay of contributions

A

punishment opportunities to VCM

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13
Q

what is the main paper

A

Fehr and Gachter 2000

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14
Q

Fehr and Gachter 2000
experimental design

A

VCM game
- conditions with and without punishment opportunities (punishment + no punishment phases)
- treatments = partners + strangers

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15
Q

what was the punishment conditions

A
  • play a round - get stage 1 payoffs
  • after the round players are told the contributions of others and can assign punishment points to them anonymously
  • punishment costs both
  • for each punishment point received - players points from first stage are reduced by 10%
  • after players told how many punishement points they have been given
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16
Q

what is the standard theory of what will happen
if the game is played with punishment

A

subjects motivated only by own points
they would never punish
wouldnt want to incur costs of punishing
punishing has no positive effects on contributions

  • solved by backward induction - they wouldnt punish and the wouldnt contribute - every round
17
Q

why would players punish

A
  • strategic motive - to encourage contributions in early rounds
  • reciprocal reasons
  • unfavoural inequality
18
Q

how would you test the strategic motive of punishment

A

comparing partners and strangers

  • should be more punishment in early rounds for partners
19
Q

how does aversion to unfavourable inequality
justify punishment

A
  • low contributors have higher payoffs in stage 1 than high contributors
    high contributors will punish low contributors
20
Q

what are the predictions of inequality aversion on punishment

A
  • even low contributors will contribute to not get punished
  • higher contributions in treatments with punishment
  • low contributors punished by high
21
Q

how does reciprocity explain punishement

A
  • subjects will strong enough recipricol motives
  • will punish low contributors for their unkind actions
  • people want to repay unkindenss with unkindness
22
Q

predictions of reciprocity

A
  • higher contributions in punishment treatment
  • punishment of low contributors
  • punishment of high contributors that anticipate that high contibutors will attack them - recirpocatng the punishment
23
Q

Fehr and Gaechter 2000 findings for strangers and partners

A

order of punishment phases doesnt make difference

always discontinuity between the rounds where the switch is

  • without punishment = decay for both strangers and partners
  • with punishment = dont see decay , higher contributions on average
  • for partners - reversed decay
24
Q

why is there no decay found with punishment

A

punishment prevents decay
- for partners = reverse decay - with slight increase in contributions

25
Q

what is the final round differences between partners and strangers

A
  • partners contribute more than strangers
  • without punishment = no difference between strangers and partners - majority of people are freeriders 70%
  • with punishment
    spike at the end with 80% of partners contributing everything - no big spike for strangers
26
Q

what did FG find about the deviation of a subject from the average contribution of other group members and the amount of punishment points receieved

what is the trend

A
  • if you contribute less than the average you will get punished more
  • the bigger the deviation away - the more punishment
  • some people that contributed more than average still got punished (recipricol?)
27
Q

what did the regression results suggest

A
  • DV = punishment received
  • negative deviation from group average is statistically significant - positive effect (magnitude stronger in partners)
28
Q

why is strategic not the core reason for punishment

A

cant explain punishment in starngers
cant explain punishment in late rounds of partenrs

29
Q

punishment partenrs

A

highest contributions
reverses decay
punishemnt is a good thing

Behaviour (26 decks)

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