Harm on an Innocent Outsider as a Lubricant of Cooperation – An Experiment

Publication Type  Preprints
Author  Christoph Engel, Lilia Zhurakhovska
Year of Publication  2012
Issue  2012/02
Abstract  If two players of a simultaneous symmetric one-shot prisoner’s dilemma hold standard preferences, the fact that choosing the cooperative move imposes harm on a passive outsider is immaterial. Yet if participants hold social preferences, one might think that they are reticent to impose harm on the outsider. This is not what we find, however severe the externality. A within-subjects measure of reticence to impose harm does not explain cooperation. But the externality makes participants more pessimistic. However conditional on their beliefs participants are more, not less cooperative if cooperation entails harm on an outsider, provided the externality is not too severe.
Publisher  Max Planck Institute for Research on Collective Goods
Place Published  Bonn
URL  http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2007029
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Keywords  externality, prisoner’s dilemma, Modified Dictator Game, Beliefs
JEL-Codes  C72, C91, D03, H23