The efficient interaction of indirect reciprocity and costly punishment

Abstract

Human cooperation in social dilemmas challenges researchers from various disciplines. Here we combine advances in experimental economics and evolutionary biology that separately have shown that costly punishment and reputation formation, respectively, induce cooperation in social dilemmas. The mechanisms of punishment and reputation, however, substantially differ in their means for 'disciplining' non-cooperators. Direct punishment incurs salient costs for both the punisher and the punished, whereas reputation mechanisms discipline by withholding action, immediately saving costs for the 'punisher'. Consequently, costly punishment may become extinct in environments in which effective reputation building--for example, through indirect reciprocity--provides a cheaper and powerful way to sustain cooperation. Unexpectedly, as we show here, punishment is maintained when a combination with reputation building is available, however, at a low level. Costly punishment acts are markedly reduced although not simply substituted by appreciating reputation. Indeed, the remaining punishment acts are concentrated on free-riders, who are most severely punished in the combination. When given a choice, subjects even prefer a combination of reputation building with costly punishment. The interaction between punishment and reputation building boosts cooperative efficiency. Because punishment and reputation building are omnipresent interacting forces in human societies, costly punishing should appear less destructive without losing its deterring force.

Punish or perish? Retaliation and collaboration among humans

“…Since players tend preferentially to help those who contributed to the public good, this effectively provides rewards which are not costly because those who reward earn a good reputation and thus benefit in later rounds of the indirect reciprocity game. If in addition to indirect reciprocity, the players have an opportunity to directly peer-punish those who do not contribute, they use this opportunity less often, but in a more focussed way, see Figure 1 [75]. Costly punishment and rewarding through indirect reciprocity combine very efficiently to boost cooperation in group interactions.…”

“…(After Fehr and Gächter [4]). [75]). In the PUN treatment, player can punish their co-players after every round of a Public Good game.…”

Cooperation in defence against a predator

“…In the situation considered here, a predator can 1 Partnership is a relation between at least two individuals when it is their best interest to help each other since by doing so they increase the probability of being together in the future and they continue to help each other. Rockenbach & Milinski 2006). 5 The altruistic defence is not in order to allow an individual to stay in the group, and altruism is not considered as a result of the "pay-to-stay" hypothesis (Kokko & Johntone 2002 …”

Information-sensitive Leviathans

“…Furthermore, like in a feudal society the authority is not appointed by a competitive procedure, but he is merely born into his position. 6 Following previous works showing that decentralized sanctions prevail over a sanction-free environment (Gürerk, Irlenbusch, & Rockenbach, 2006) and over a pure reputation-building environment (Rockenbach & Milinski, 2006), we let our players choose their institution by leaving societies (exit), but not by vote (voice). 7 Consequently, each citizen is free to migrate to his most preferred institution.…”