State or nature? Endogenous formal versus informal sanctions in the voluntary provision of public goods
Research output: Contribution to journal › Journal article › Research › peer-review
We investigate the endogenous formation of sanctioning institutions supposed to improve efficiency in the voluntary provision of public goods. Our paper parallels Markussen et al. (Rev Econ Stud 81:301–324, 2014) in that our experimental subjects vote over formal versus informal sanctions, but it goes beyond that paper by endogenizing the formal sanction scheme. We find that self-determined formal sanctions schemes are popular and efficient when they carry no up-front cost, but as in Markussen et al. informal sanctions are more popular and efficient than formal sanctions when adopting the latter entails such a cost. Practice improves the performance of sanction schemes: they become more targeted and deterrent with learning. Voters’ characteristics, including their tendency to engage in perverse informal sanctioning, help to predict individual voting.
Original language | English |
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Journal | Experimental Economics |
Volume | 18 |
Issue number | 1 |
Pages (from-to) | 38-65 |
Number of pages | 28 |
ISSN | 1386-4157 |
DOIs | |
Publication status | Published - 2015 |
Bibliographical note
JEL Classification: C92, C91, D03, D71, H4
ID: 128680929