Spillover Effects of Institutions on Cooperative Behavior, Preferences, and Beliefs
Author(s) -
Florian Engl,
Arno Riedl,
Roberto A. Weber
Publication year - 2021
Publication title -
american economic journal microeconomics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 5.339
H-Index - 40
eISSN - 1945-7685
pISSN - 1945-7669
DOI - 10.1257/mic.20180336
Subject(s) - spillover effect , cooperativeness , enforcement , scope (computer science) , affect (linguistics) , economics , microeconomics , public good , control (management) , public economics , punishment (psychology) , social psychology , psychology , political science , programming language , management , communication , personality , law , computer science , temperament
Most institutions are limited in scope. We study experimentally how enforcement institutions affect behavior, preferences, and beliefs beyond their direct influence over the behaviors they control. Groups play two identical public good games, with cooperation institutionally enforced in one game. Institutions generally have economically significant positive spillover effects to the unregulated game. We also observe that institutions enhance conditional cooperation preferences and beliefs about others’ cooperativeness, suggesting that both factors are drivers of observed spillover effects. In additional treatments, we provide evidence for several factors, including characteristics of institutions, that enhance or limit the effectiveness and scope of spillover effects. (JEL C92, D02, D83, D91, H41)
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