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Network Architecture and Mutual Monitoring in Public Goods Experiments

Author

Listed:
  • Carpenter, Jeffrey P.

    (Middlebury College)

  • Kariv, Shachar

    (University of California, Berkeley)

  • Schotter, Andrew

    (New York University)

Abstract

Recent experiments show that public goods can be provided at high levels when mutual monitoring and costly punishment are allowed. All these experiments, however, study monitoring and punishment in a setting where all agents can monitor and punish each other (i.e., in a complete network). The architecture of social networks becomes important when individuals can only monitor and punish the other individuals to whom they are connected by the network. We study several non-trivial network architectures that give rise to their own distinctive patterns of behavior. Nevertheless, a number of simple, yet fundamental, properties in graph theory allow us to interpret the variation in the patterns of behavior that arise in the laboratory and to explain the impact of network architecture on the efficiency and dynamics of the experimental outcomes.

Suggested Citation

  • Carpenter, Jeffrey P. & Kariv, Shachar & Schotter, Andrew, 2010. "Network Architecture and Mutual Monitoring in Public Goods Experiments," IZA Discussion Papers 5307, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp5307
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    References listed on IDEAS

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    1. David Masclet & Charles Noussair & Steven Tucker & Marie-Claire Villeval, 2003. "Monetary and Nonmonetary Punishment in the Voluntary Contributions Mechanism," American Economic Review, American Economic Association, vol. 93(1), pages 366-380, March.
    2. Carpenter, Jeffrey P., 2007. "Punishing free-riders: How group size affects mutual monitoring and the provision of public goods," Games and Economic Behavior, Elsevier, vol. 60(1), pages 31-51, July.
    3. Jeffrey Carpenter & Peter Matthews, 2009. "What norms trigger punishment?," Experimental Economics, Springer;Economic Science Association, vol. 12(3), pages 272-288, September.
    4. Kosfeld Michael, 2004. "Economic Networks in the Laboratory: A Survey," Review of Network Economics, De Gruyter, vol. 3(1), pages 1-23, March.
    5. Cinyabuguma, Matthias & Page, Talbot & Putterman, Louis, 2005. "Cooperation under the threat of expulsion in a public goods experiment," Journal of Public Economics, Elsevier, vol. 89(8), pages 1421-1435, August.
    6. Demange,Gabrielle & Wooders,Myrna (ed.), 2005. "Group Formation in Economics," Cambridge Books, Cambridge University Press, number 9780521842716, October.
    7. Nikiforakis, Nikos, 2008. "Punishment and counter-punishment in public good games: Can we really govern ourselves," Journal of Public Economics, Elsevier, vol. 92(1-2), pages 91-112, February.
    8. repec:bpj:rneart:v:3:y:2004:i:1:p:19-41 is not listed on IDEAS
    9. Simon Gachter & Ernst Fehr, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Helbach, Christoph & Keldenich, Klemens & Rothgang, Michael & Yang, Guanzhong, 2012. "Call Me if You Can – An Experimental Investigation of Information Sharing in Knowledge Networks," Ruhr Economic Papers 332, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    2. repec:zbw:rwirep:0332 is not listed on IDEAS
    3. Christoph Helbach & Klemens Keldenich & Michael Rothgang & Guanzhong Yang, 2012. "Call Me if You Can – An Experimental Investigation of Information Sharing in Knowledge Networks," Ruhr Economic Papers 0332, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    4. Theodore Eisenberg & Christoph Engel, 2012. "Assuring Adequate Deterrence in Tort: A Public Good Experiment," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2012_07, Max Planck Institute for Research on Collective Goods.

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    More about this item

    Keywords

    punishment; monitoring; public good; networks; experiment;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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