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Learning to cooperate in the shadow of the law

Author

Listed:
  • Roberto Galbiati

    (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)

  • Emeric Henry

    (Institut d'Études Politiques [IEP] - Paris)

  • Nicolas Jacquemet

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

Abstract

Formal enforcement punishing defectors can sustain cooperation by changing incentives. In this paper, we introduce a second effect of enforcement: it can also affect the capacity to learn about the group's cooperativeness. Indeed, in contexts with strong enforcement, it is difficult to tell apart those who cooperate because of the threat of fines from those who are intrinsically cooperative types. Whenever a group is intrinsically cooperative, enforcement will thus have a negative dynamic effect on cooperation because it slows down learning about prevalent values in the group that would occur under a weaker enforcement. We provide theoretical and experimental evidence in support of this mechanism. Using a lab experiment with independent interactions and random rematching, we observe that, in early interactions, having faced an environment with fines in the past decreases current cooperation. We further show that this results from the interaction between enforcement and learning: the effect of having met cooperative partners has a stronger effect on current cooperation when this happened in an environment with no enforcement. Replacing one signal of deviation without fine by a signal of cooperation without fine in a player's history increases current cooperation by 10%; while replacing it by a signal of cooperation with fine increases current cooperation by only 5%.

Suggested Citation

  • Roberto Galbiati & Emeric Henry & Nicolas Jacquemet, 2024. "Learning to cooperate in the shadow of the law," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-04511257, HAL.
  • Handle: RePEc:hal:cesptp:hal-04511257
    DOI: 10.1007/s40881-023-00159-x
    Note: View the original document on HAL open archive server: https://hal.science/hal-04511257
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    References listed on IDEAS

    as
    1. Dirk Sliwka, 2007. "Trust as a Signal of a Social Norm and the Hidden Costs of Incentive Schemes," American Economic Review, American Economic Association, vol. 97(3), pages 999-1012, June.
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    More about this item

    Keywords

    Enforcement; social values; cooperation; learning; spillovers; repeated games; experiments;
    All these keywords.

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