Titel
Covenants before the swords: The limits to efficient cooperation in heterogeneous groups
Autor*in
Nikos Nikiforakis
Division of Social Science, New York University Abu Dhabi
Charles N. Noussair
Department of Economics, Eller College of Management, University of Arizona
Abstract
When agents derive heterogeneous benefits from cooperation, a tension between efficiency and equality often arises. This tension can impede agents’ ability to cooperate efficiently. We design a laboratory experiment, in which we investigate the capacity of communication and punishment, separately and jointly, to promote cooperation in such an environment. Our results reveal that cooperation and earnings are significantly greater when both communication and punishment (a sword) are possible than when only one is available. Both cooperation levels and earnings, however, still fall substantially below the maximum possible. The reason is that groups establish covenants, i.e. mutual contribution agreements, that tend to strike a compromise between efficiency and equality. The timing of communication is critical. A history of sanctioning substantially reduces the probability that groups subsequently establish a covenant. Overall, our findings indicate not only the benefits of early communication, but also some limits to efficient cooperation in heterogeneous groups.
Stichwort
CommunicationPunishmentCooperationNormative conflictHeterogeneity
Objekt-Typ
Sprache
Englisch [eng]
Persistent identifier
phaidra.univie.ac.at/o:1437423
Erschienen in
Titel
Journal of Economic Behavior & Organization
Band
188
ISSN
0167-2681
Erscheinungsdatum
2021
Seitenanfang
307
Seitenende
321
Publication
Elsevier BV
Erscheinungsdatum
2021
Zugänglichkeit
Rechte
Rechteangabe
© 2021 The Author(s)
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