Urs Fischbacher
How do people choose between reward and punishment in order to enforce a fairness norm? We investigate this question in a four-person mini dictator game with a sanctioning option. In this game a mechanism designer decides whether reward or punishment is available as a sanctioning device. Another person, the mechanism implementer, is informed about the decision of the dictator and can then decide whether the available mechanism is implemented or not. We find that designers select the punishment mechanism when the unkind action was the rare choice and the reward mechanism when the kind action was the rare choice. In addition, implementers punish more frequently when the unkind action is rare and reward more frequently when the kind action is rare. This is in line with implementers applying a Levine (1998) style intention attribution and designers providing the mechanism that is more likely to be desired. Decision time analysis corroborates this view for the punishment and for the design decisions.
Joint work with Konstantin Hesler.